Why did PR2 die off?

[Camer the Dragon]

Isn't that the point of the tournament server? I"ve messed with it a few times and it seems like it sets your stats to 65 across the board, and remvoes hats. Never seen it played properly though.

Tournament server forces stat combo and 65/65/65 aren't good stats. If it made it 195 stat points that'd be far better. Also removing hats outright is a bit much as it removes hat dynamics, which depending on the level can be fine (and you can ban hats from specific levels now anyway).
It terms of people not really playing it, it's for these reasons as well as 2 other things. The first thing being there's no consistent organised get-together schedule, the second thing being that you don't get exp on tournament server.