My guess is, the reason why this market seems to be 'dead' is that those who wanted a media player already has one and are using their current hardware until it dies.
Also, more and more TV's and Blu-Ray players (or others, like Ruku and Boxee Box), are getting more services integrated like Vudu, Netflix, and similar services, which can negate the need for a media player like a Dune.
Or..another reason may be is that these players can be a hassle to set up - especially if you want to set it up properly (that means networking - making sure the PC and Dune/media player 'sees' one another on the network and can pass files back and forth, adding in programs to make a user-friendly interface like yadis, buying the hard drives needed - and external bays if needed..etc etc. This can be quite a chore and sometimes overwhelming for those who want everything to be working as fast as possible.