Alyx has 2,000ish concurrent players at this point, while Left 4 Dead 2, a 11 year old game, has over 17,000.
You're being incredibly dismissive of the tech in an unconvincing way. Being fortunate enough to own a rig and hmd to play VR with, it's clearly hit a turning point with Alyx.
Does that mean it's going to become the next iPhone tomorrow? No. The biggest hurdle in terms of adoption is lowering prices. Next is reducing motion sickness and researching what makes a VR game fun and immersive. We now have teleport locomotion systems and 144 Hz refresh rate that don't make us as motion sick. And Valve has now learned how to make these games incredibly fun, immersive and with an absolutely fantastic story.
It's an utterly unbelievable experience.
To your last point about player counts, yeah they're low. But it doesn't make any sense to compare a single player game which is played once or twice and it _definitely_ doesn't make sense to compare a 60$ game that minimally requires very cheap hardware to a 60$ game that requires about a 600$ PC and a 250$ - 1000$ VR headset.
VR isn't going to die again. It will take time, but it will definitely become mainstream in 10-15 years. And while for some reason you seem to see Alyx as a failure, I see it as the spark that ignites the VR revolution.
Steam itself seemed to be in maintenance mode with very little love until the last two years (when real competition emerged).
Valve seems like the kind of place with constant power struggles and office politics, even more so than a traditional org.
Separately, why are they still bothering with Source 2? Their competition is technically superior in pretty much every respect.