I just noticed this topic, so here is my 2 cents (plus inflation, means I owe you 3 dollars).
I don't think there is really anything wrong with this forum. I've been pleasantly surprised that it is active, but not overwhelmingly so. So many boards just get clogged with random chatter. Horribly so sometimes. By contrast, I find this forum is solid. There are regulars and there are games like KS which will not die.
To me, this forum is a creative outlet. Nifflas' games set a standard of quality that most in the forum strive to follow. I do keep wishing there could be more flexibility in game making here in that to me, each Knitt Story is a Story and only a story. That is the beauty of it, not that it is about tiny people. This is a forum about creativity, and only those dedicated to doing so tend to stay. Again, the beauty of KS is it lets average shmoe's like me, who have no programing skills, to make beautiful games. There may be other places that do that, but I'm not aware of them. That is what makes this place unique and solid.
I have always been a little confused as to why there is not general chatter forums here, which would tend to attract more activity, but I've come to realize that I like the stillness here, which seems to ebb and flow without actually "dying."
Shawnachu posted while I was posting this, so I'll just add the comment that yes, it would be nice to be able to do kick-back chatter, though I've recently come to realize most of that is done in the niffchat.