There was of course the soundtrack balls up resulting in new sets being sent out by Amazon. While CBS handled it well, it was still a PR disaster for the rest of the forthcoming seasons, and likely put people off buying them especially at the $60 the price point. Season 2 which was and still is riddled with issues, was probably the final nail in the coffin for all but die hard Trekkers.
With the softer images on the later seasons due to the filming techniques used at the time, people are not getting the picture quality of the earlier seasons. I know it's not anyone's fault, and that CBS have done the best they can, but at $60+ per season, I don't expect episodes that look like good quality DVD, especially when I've already got the DVDs from 13 years ago. Having watched the season 7 trailer yesterday, the footage looks very very soft.
And as tomswift has said, you can't buy them on the high street. That kills impulse purchases, and does nothing to raise awareness that they exist. Again, the price probably has a lot to do with the lack of store availability.