Yes, but not right away. It took a while for the knowledge and processes to become established. Piracy wasn't what sank the Dreamcast. By the time piracy became commonplace, roughly mid-late 2000, the DC was already pretty obviously going to lose in the market to both the PS1 and upcoming PS2.

Casual piracy was significantly easier on the DC, but not because GDRoms were easy to copy. What was easy to do was to convince the system to boot from a standard CD, and it turns out some games didn't take up a whole GDRom or could have their textures easily replaced with lower res or better compressed versions allowing them to fit on a self-booting CD.

Kind of? The 1ST_READ.BIN had to be re-scrambled to run off of CD-ROM, but this was trivial after the Utopia leak.

However, if this were the reason for the demise of the console, we could expect large volume sales of the (loss-leader? or close to it?) console, and limited game sales.

Instead, unfortunately for Sega and ultimately, everyone, we saw limited sales of both the Dreamcast console and its games - a sign that the console itself was simply defeated by the PS2, rather than piracy.

Another argument here is that the PS2 suffered from a similarly trivial "swap magic" exploit just after release, where as long as the disc drive never registered a disc ejection, running code could simply be switched out for another piece of running code.

By the time Dreamcast piracy was common place, the console was already cancelled.