Well, this post ended up disturbingly larger than expected.
I can't speak for the community in general, I've only become aware of the board recently. As far as Knytt Stories goes however, I do feel there's something of a wasted opportunity, or at least an incomplete project there. Obviously 2d gaming is alive and well throughout indie gamemaking circles and particularly in freeware games, so graphically and gameplay-wise a game like Knytt Stories is bound to have a long play-life, longer than it would on a console. The fact that people still play levels, and better yet that people still make (or begin...) levels is a good sign. Particularly because the conditions aren't great: there are lost levels, the level archive is very basic and uninformative and, to most people, largely unappealing; the topics themselves are somewhat disorganized with piles of unsorted levels and unfinished levels filling up space.
What's truly lacking is both a proper structure for organizing levels in an accessible and appealing level -- and the projected new level archive, whether still going or not, seems a way of adressing that -- and something regularly calls attention to the game itself. I disagree with comments about the issue being "novelty"; the proper determining difference it that when the level was released and written there was a large call of attention to it. The fact that to keep playing Knytt Stories now essentially means either randomly selecting dozens of unclassified levels or trawling through the board's archives hoping to sort the bad and the good means there's no easy, quick way of renewing play; the level archive could do this, but so could new level packs (like the ones originally released) that were produced on a regular basis either with custom content or as best-of collections; and sustained sharing and commenting on existing levels through an independent board, the level archive, or even a separate site. And I do think there are corners of game criticism and sharing on the web that would be open to divulging such packages, that would be open to easier, more widely appealing solutions.
None of this is necessarily easily made and would have more easily been implemented long ago, but I do think there's something to be said as to how Knytt Stories as a whole could have been constructed as a long-term, self-sustained, more publically oriented project. Something that is easily and immediately adressed now, is the issue of the contents of the levels made, the whats and whys of level-making. Some issues are harder to address -- people's lack of ability, resources, and imagination in producing new custom content can't be entirely chalked up to lazyness, and an open editing experience has to accept and cope with that, as well as genuine lack of designing abilities. I think it's hard to address these issues and I think sometimes it goes great (people were very honest and helpful with their criticism of my first level), and other times people have a hard time criticizing openly and productively. Something that I do think can be shifted is the difficulty of levels made, or more specifically the specific aims with which levels are made. I do think there's a good ammount of levels made by level designers for level designers; levels that are so thouroughly enthralled in exploring both the mechanics of the game and the most demanding playing skills that they end up as appealing to people who know the game inside out and hardly anyone else.
Not to be exclusively critical though; I say this precisely because I think that there are levels that don't just appeal as Knytt Stories levels, but that are appealing as games; levels that do such a good job at working with the system and the imaginary of the game that they both continue Nifflas's work and show other possibilities that would appeal, I think, to a lot of people if they had any idea there was that degree of quality there. This plays into the appeal (or lack of) of making them right now, even; I was prepared for my level to be played by two, three people, but it's easy to understand that most people aren't, and that undercuts the necessary income of people and new level-making to keep the game alive and well.
I think some of the things I've pointed out address how Knytt Stories could work better, ideally at least, and I think this could only have a positive impact on the board as a whole, since they do seem to make up an important part of it. I'm sorry for writing such a long post and I hope it's not too off-topic, I've just had these things on my mind for a while and, apparently, the rant has built up into this. If the post needs to be removed or copied onto a new thread where it would make more sense (which is standard practice in other boards I've accompanied), feel free to do so, sorry!