I think the lack of star power is it. Dredd is pretty much an unlikeable guy nobody can really relate to, and then he is played by a no name. Oh yeah, Eomer and McCoy, and that bad guy from one of the Bourne films. Supporting cast. And who the hell is Lena Heady?
And again, just like with Stallone's Judge Dreed, the helmet has nothing to do with any of the films problems.
And I think the audience runs out of interest. Total Recall tanked, despite looking polished, being PG-13, and having Colin Farrell, Jessica Biel and the girl from Underworld whose name currently escapes me. And Dredd didn't have any big names, didn't look that good and was R. The stories of both films are essentially reduced to "get from A to B and have action scenes in between" and that's it. All in all it's just generic stuff.