1. They split brands (and didn't use them)
The "brand" split was desperately needed to adequately promote and make money off of a saturated roster. Unfortunately, the rosters for the tag-team division, cruiser-weight and the women's divisions suffered because they were smaller than the singles roster. Raw got the women's division, which did well at first but eventually fell to diva-ism. The cruisers went to Smackdown and were too few in numbers to make an impact and rarely were given a chance. The tag teams stayed in both brands, which meant one or two real "teams" plus whatever leftover singles wrasslers needed time getting paired with one another. Only with a few pay-per-view events do the two ever meet and I personally think they are missing out on a great opportunity to promote competition (and in turn material that spawns off and keeps the viewer interested).
2. They decimated the women's division
Remember about a year or two ago when the women's division was the best as far as overall wrestling? You had Molly Holly, Trish Stratus, Victoria, Gail Kim, Jackie and a couple others I'm forgetting. At that point in time they could have realistically been the main-event on Raw (I think they did, once). The point is: back in those days there was enough trust placed in the women to actually wrassle instead of valet. Lita bled, Victoria and Trish went hardcore. Then, without warning most of them were gone, replaced by a glorified bimbo contest. What's worse is that the WWE lucked on to a genuine talent in Christy Hemme; simply put the woman is nuts. An (arguably) attractive red-head willing to do anything (as an appearance on Howard Stern proved), with the persona to got nuts on everybody providing hours of story material and they literally do nothing with her.
3. There is little or no aspiration
Every wrassler should be aspiring to win gold at the highest level; a championship. The only exceptions to this rule would be the psychotic monster role (happy when hurting people, thus no need for gold) and the nemesis role keeping others from achieving success. Wrasslers nowadays get stuck in temporary storylines to get them to the next pay-per-view at which point that storyline will be forgotten altogether to build another feud for the next pay-per-view with little or no continuity. Only a few wrasslers are allowed to be part of title aspirations, most of the time to get to the next pay-per-view. This whole building of temporary feuds with no background to get to the next pay-per-view is ridiculous.
4. They decimated the tag team division
Tag-team wrasslin' has been an integral part of wrasslin' for years. From the Minnesota Wrecking Crew to the Road Warriors to the Dudley boys there have always been marketable icons in the tag-team realm. There are no viable tags teams left in the WWE. The only thing close is the "new" Legion of Doom with Heidenreich replacing the late "Hawk" and Christy in Paul's place. It's hard to build legendary tag teams when the talent for each is scrambled across two brands. It was just as hard back in the days when the The Hardys, The Dudleys and Edge and Christian were the central figures for years, buy they made it work.
5. New talent hasn't cut it (or been given the chance)
Week after week the people cutting the best promos and wrasslin the best matches are the veterans that have been in the business forever. Last week the 100 year old Rick Flair came out, bled to death twice over a suit, then went hunting Hunter with a baseball bat. He came across a legitimate whacko. Austin delivered another classic Austin promo. Kurt Angle is on the rampage. What is everybody else doing? People, myself included, are tuning out because we don't want to stay up on a Monday or watch TV on a Friday to watch Flair or Hogan carry a load because the rest of the roster cannot.