The Internet conquered Time and Space. Want continue a chat with someone from another continent in real time or have your messages stored and retrieved over a period of years? No problem. But now with time and space conquered we decide we want to add time and space... Hmm... So do I have to walk over to his avatar? And chat? I would like to see someone solve this conundrum and make it compelling. I find it an interesting problem to ponder.
I would extend your remarks with the observation that the worlds most successful online bookstore looks more like a superspammy point of sale system or superspammy order entry system, rather than a virtual 3-d world with virtual grep-less bookshelves and a virtual check out line with a virtual cash register staffed by a virtual teen slacker. Peapod is also a good example.
I think that this is the core of it. Virtual worlds were always going to struggle because the abstract space that is the internet, where people cluster around concepts and you're never more than one step from anyone else who is connected is just much, much less limiting than dimensional space.
There is only one thing that dimensional space is good for, and that is for serendipity. When you can talk to anyone, you talk only to those you already know you want to talk to. When you're located in a point in space, you talk and interact with others that happen to be near that point in space. This is why the few areas that virtual reality does seem to be useful is for meeting new people, or for activities where limiting yourself is the whole point -i.e. games.
Maybe for exploring, but if the main thing you wanted to do was to talk with people, why not let you jump straight to them.
It's interesting that arguably the world that got the most traction, IMVU, eschews movement and only lets you jump to predefined spots, which lets people stand or sit next to each other faster..
