The impression I got was MCE was killed not because few users were using it, but that it took power users to use it. Efforts like Windows Home Server mostly just proved that average consumers didn't want to run and configure a server environment in their home. Very rarely did people trying to use the MCE have the hardware they needed to support all of its features well.

That's why so much of the media control efforts got pushed to Xbox because at least with the Xbox they could control more of the hardware directly. (Then those efforts were sabotaged in the early days of the Xbox One by bad press, which was a terrible shame because they had a lot of great ideas half-executed.)