I think they gauged the market pretty well. I also don't think they lost anywhere near half of their customers.
The 4E = WOW contention is seriously spurious. If I wanted to, I could hand-wave a "3rd Edition is nothing but Baldur's Gate for the tabletop" argument, and it'd have about as much weight. I have yet to see an actual list of similarities unique to 4E; instead, it's only "general feelings" and assumptions. As someone who plays both WOW and D&D, the association is ridiculous. They both have a class they call "paladins," and the similarities end there.