Well we did get DeNCS out of it, so it wasn't all bad.
Having been involved in an ill-fated large modding project myself (BG2R), I have some sympathy for TSLRP. I know well the pain of lots of people clamouring for a release, but nobody willing to actually help do the work. Having observed the TSLRP drama unfold fairly passively from the outside, I think their main mistake was not making public releases from an early stage. Closed beta testing is fine and a necessity, but don't go making a big song and dance publicly about something until you are willing to release it. Doing so would have done two things. It would have dampened some of the noise from the peanut gallery, and it likely would have encouraged more people to volunteer to help.