This decision is emblematic of the conundrum Vince created by promoting WWE and the WWE Style as the be-all, end-all of the wrestling world. When you condition your audience to accept your company's product as the only one that matters, it's hard to make them care about a brand specifically promoted as the opposite of that WWE template.
Also, I think it's clear that Vince is right in the regard that the original ECW fanbase is indeed dead. The company was out of business for 5 years, which means a vast segment of today's wrestling fans were too young to watch or remember the original ECW. The ECW fans connected with Tommy Dreamer and The Sandman due largely to years of storylines and character development, not due to pure wrestling ability. That's the predominant reason why Dreamer and Sandman have generated little crowd reaction outside of ONS.
The idea of reviving ECW is comparable to reviving 'Saved by the Bell' today: the talent's too old to pull off the characters, 90% of fans don't know what the backstories are, and the resulting product would be unsatisfactory to the 10% of hardcore SBTB fans because it isn't exactly the same as the glory days.