In a nutshell, competitive 2WD 1/10 scale RC cars have evolved into their final form. It was first established with the RC-10 and has evolved to the point where the latest version vehicles are almost indistinguishable from the last version. I personally miss the days of flat graphite chassis plates and backyard engineering. It was always so cool to transform your RC10 into a sprint car or late model oval racer by using your own ideas and imagination, and someone else was always doing something new that you hadn't thought of. The car manufacturers who evolved the design survived (Associated, Losi, Traxxas, Hyperdrive), the Big Japanese companies survived (Tamiya, Kyosho), and other lesser companies folded up. As far as the aftermarket parts companies, the designs became so integrated that there was not a whole lot of room for improvement. Most of what you see is the stock design done in a different matearial (aluminum parts or different formula plastics).
I think the biggest problem with the hobby is that it was never advertised beyond the RC magazines. The Tamiya commercials ran a few times when I was a kid, but that was about it. At its peak, Associated could have afforded a nationwide advertising campaign here in the States, but they never did. If you are ever in a Hobby Shop when a true newbie walks in you'll notice they are overwhelmed by stuff they never even new existed. XBox, PS, and the rest of the computer / video game systems have multi-million dollar advertising campaigns, RC stuff is never advertised beyond RC themed mags.
As far as Kyosho in the US, they were not happy to no longer be the top dog at Great Planes, so they started planning to self distribute. GP got wind of this and dropped the product and pushed rumors of Kyosho going out of business. And Gil Losi had gotten fed up with the bureaucracy in the company he had started; now he's at Kyosho.
I think the next trend you will see will be 1/10 scale 4WD become more prominent OR 1/8th scale 4WD electric will catch on. The new combination of LiPo batteries and brushless motors is too powerful for 2WD platforms, and I see 4WD as the solution. I have an 11V Mamba system in a XXX4, and it's just about the fastest thing at the track, at any scale, but the size of the chassis limits what you can actually do with it. www.4wdrc.com
The Legends design was sold to Xtreme RC Racing in York SC. http://www.xtremercracing.com/INFORMATION.cfm Bruce made them in small quantities but it really didn't catch on. It's just too easy to get a touring car or pan car from ebay and the local track is so bumpy that suspension travel is really required. He may have sold the enterprise back to the original owner, or he may be still building them for the old owner as you can now get them from www.bolink.com. Either way its just too easy / cheap to get a better car used from ebay.
Bob