Blame the board of directors
HP under Mark Hurd had, for the most part, turned around after the Fiorina era. Hurd was, apparently, a little sketchy personally but not enough to justify firing. The board, however, didn't like his direction and brought in (ugh) Apothecker and it all went pear shaped.
Hurd was smart enough to say that Palm/WebOS was a long-haul proposition and was not expected to set the market on fire. So when Apothecker killed Palm/WebOS because it didn't set the market on fire....face-palm.
I think Hurd's ultimate goal was beating RIM and eat the corporate space, rather than trying to defeat Apple & Android. Tie WebOS into the HP management software suite and you could kit out an company from top to bottom with HP tech (cellphone, laptop, PC, server, printer, SAN, LAN, management, etc).
I'm a WebOS fanboi so if HP did decide to release a Pre4 (or just mass produce more Pre3s) I'd buy it.
However I expect that won't happen and that I'll migrate to Android 5 when my Pre2 finally dies. At least by then Mattias Duarte will have added some more WebOS-ification to Android. Maybe Android'll get card-type app management.....