Well, certainly this has been a puzzler for us as well. This remains probably our best-reviewed game, even above AI War. Everybody who plays it pretty much loves it, and the same went for press. The metascore on this one is about the same as AI War (low 80s, which is quite good), but when you factor in non-metacritic reviews it's way better-reviewed than AI War.
A few things I'd like to point out that seem related to the failure, at least:
1. Almost nobody has heard of this game. This was as much a marketing failure as anything else (this far predates Erik being with the company). In general I handled the release of information about this game really poorly, and that didn't help. Also, the timing of its release was particularly bad (late July 2010) as that was a major sales slump period in general. Which contributed to lots of people not noticing it.
2. In terms of the actual reason that we haven't been able to break even with this, we spent too much money making the game. Too many man hours over too long a period of time for a game of this sort. To some extent if we'd released with 1/5th the content the game might have still sold the same amount and we would have broken even. It might even have made the game more accessible, because some people definitely do feel overwhelmed on starting it up.
3. I adore the art and music style in this game, but it seems to have been a really poor fit for the Steam audience. Hardcore gamers just immediately give this sort of game a pass, in the main, when they glance past screenshots. That's entirely my fault, as I set that sort of art and music direction. However, I do think that this sort of style will do brilliantly on mobile, and with that in mind we're looking at bringing the game to iPad 2+ late this year or early next. I think that we have a much better chance of success there.
4. As a general note, this is not the sort of game that excites people to tell their friends about it. So it wasn't something that spread virally in quite the same way that AI War did. Or even AVWW did more than a little of that.
5. Both the trailer that I did, and the trailer that Phil did, were found to be hugely underwhelming to players. Phil was unimpressed with mine and so did his version, and his version was indeed better. However, this is a very hard game to make a trailer for, and ultimately I think that players were not responding to these the way we hoped.
6. When people look at the game in very brief passing, it seems to just be "another match 3 game." When people are giving it a cursory glance, I think this causes them to keep looking rather than pausing to digest at all. That's not overly helpful.
7. As a general note, our problem seems to be obscurity for the game rather than rejection. AVWW has a strong contingent of people who reject it, but it's so widely publicized that we get lots of people who love it just as ardently. With Tidalis, it simply never had that traction at all. The contingent of people rejecting Tidalis is almost non-existent, but nothing we have done even since Erik has been on board has helped the game reach a larger audience. Tidalis Lite was a waste of time, for example. But it was a short time investment and an interesting little side project, so it's no big thing. When it comes to the iPad port, hopefully that will bear more fruit and finally find the appropriate audience for this game.