This article I read (Tim Berners-Lee talks about W3C reform and reinventing HTML by Ryan Paul titled) really illustrates the utter failure of XForms, and shows how W3C has lost their prestige because of it. It looks like essentially the XForms standard killed XHTML2.
I have been a critic of W3C in feeling that they would go crazy on standards, but failed to connect with implementation. I often commented, why don't they actually implement the standards they design, or in other words, practice what they preach. My Linux-guru buddy always remarked, "what do you expect from standards comittees".
Ryan commented that "XForms failed as a standard because it wasn't developed with implementation in mind", which I wholeheartedly agree. Ryan details further: "As a developer with first-hand XForms experience, I have to say that the word 'broken' best characterizes the standard. Although the concept looks great on paper, it just doesn't work for real-world projects" and later adds "The standard itself also has considerable failings, and some server-side XForms implementors have actually deviated from the standard and invented new elements to work around the holes". I think that assessment is consistent with a lot of criticism about XForms and about theory vs. reality concept in general.