The WoW influence I think was a total misreading of the market. While there is significant crossover between D&D players, at least at the time, and MMO players, Hasbro banked too much on that trend thinking it was the future. It was a mistake that even Ryan Dancey made. To many people listened to Dancey a little too religiously after the success of the D20 System License and OGL when he kept harping on and on about WoW and other MMOs and trying to capture that audience. While I don't think 4e was a financial failure as some try to proclaim, it certainly wasn't with DDI subscriptions alone, it fractured the market. I think what made Habro turn on it was losing market dominance when Pathfinder started selling just as well.
I think it was a huge mistake on WOTC's part to include all new material in DDI. They greatly undercut book sales by making all the new rules content "free" under DDI. DDI was in general a failure that hurt the edition. It seems it was designed with VTT play to become the default and when that failed to materialize in an solid form in the DDI tools they lost a lot of potential money. While I think DNDBeyond is expensive to purchase e-books, the model is pretty good and they have been wise in not overpromising like Project Morningstar.
I think you may be overselling DDI a bit. The contents of the 4e books was NEVER available on DDI. DDI had 3 tools, plus an archive of material (Dragon, Dungeon, and the organized play stuff). Compendium contained pretty much all the 'crunch' from the books, but nothing else, not even including descriptive text for said crunch. CB contained the player-facing crunch and obviously served to generate PCs. Monster Builder contained the monster stat blocks (but no descriptions at all) and let you tweak them or build your own.
For a lot of casual PLAYERS, DDI was enough. You could go into CB and simply create a character and not read any books. You missed all the flavor text, guidelines, etc. but you got enough of the gist of something that you could play it, and doubtless others in your group had at least the core books if there was a strong need/desire to reference such. For GMs DDI was not nearly enough. You simply cannot run 4e based on DDI, it lacks the actual meat of the rules text.
Beyond that DDI doesn't really contain much of the value of the GM-facing books, which is in terms of setting, cosmology, game play, resources, etc. Sure, you would get the stat blocks from the back of Draconomicon: Chromatic Dragons, but that is 10% of the book! Likewise Open Grave, The Plane Above, etc. etc. etc.
Overall though, I think you're not way off. DDI drove down the market for books. A lot of players didn't feel compelled to buy supplements, GMs might not buy every Monster Manual or supplement, etc. They could get the 'meat' of it for the price of DDI. That would have been OK, as DDI's $7/month adds up, but of course each GROUP generally got one subscription. The GM could use that to do his thing, and the players could take turns playing around with CB, or (as in some of my groups) designate one player as the 'character wrangler' who owned a subscription and did all the PC character sheets. Without a VTT to drive all the players to want a subscription, it was hard to make mint on 4e, especially when Dragon/Dungeon was part of DDI. 2/3 of 4e's players were not paying a thing. If WotC was lucky, they bought a PHB1.
In fact, 4e's core books, particularly the PHB1, sold extremely well. DDI just helped to depress the market for additional books, and 4e was built on the concept of lots of books, selling really well, and funneling everyone into DDI subscriptions. Instead people were not heavily invested, so they could just play 4e, sponge off an DDI sub, not really buy in, and then go buy Pathfinder books with their money.
Frankly, I think DDI was an instantiation of what is inevitable in the long run with TTRPGs. Everything will be digitalized. Paper books may or may not be available, but will be afterthoughts. Tools support will be what separates out the 'big boys' from small publishers. The key, for a WotC, will be making the 'digital character sheet' so compelling that nobody will want to use paper. At that point everyone needs a sub. A GM could then own a 'premium' version that lets them support the 'new kid', etc. I think 4e envisaged a lot of that, WotC just couldn't execute. I guess it is an open question if TTRPG market is big enough to support even one such platform or not...