I think we all understand ratings are not indicative of quality. What the ratings for Deep Space Nine mean: that people that were fans of The Next Generation did not necessarily watch Deep Space Nine. That the built in audience that would watch anything with Star Trek in the title was smaller than Paramount thought.
Even that is probably a simplistic reading. A lot of people watching TNG weren't watching it because it had Star Trek in the name, but because it was practically the only show of its kind on the air, and many people still watched network television exclusively. By the end of TNG's run, Trek had started competing against itself, and there were a lot more sci-fi/fantasy shows on tv.
Also, the ratings decline that began in the late TNG years and continued through DS9, Voyager and ENT corresponds to a steep drop in ratings across all networks and all genres. For example, the evening news' ratings when ENT was canceled were only a fraction of what they were when TNG first aired, due to the rise of cable television (and of the internet).
I think one would at least have to factor in these types of broad shifts in the market to analyse the ratings of these shows in a meaningful manner.