I used to use MD because:
-gapless (albeit Atrac only)
-unlimited storage (when 256MB DAPs were the norm)
-high expectation for HiMD
-excellent battery life (when MP3 DAPs were struggling to go above 8 hour per charge)
In between, we see:
-MP3 DAPs gaining better and better battery life. Now 2G iPod nano gets 24hour battery life per charge
-HiMD suffers worse battery life than legacy MD
-slow sub USB1.1 speed on HiMD, while MP3 DAPs gained USB2.0 speed
-Only Sony (and later on, Onkyo) supporting HiMD. All the other previous supporters (Panasonic, Sharp, Kenwood, etc) moved on.
-Sony being super lazy in promoting and supporting their own products (how long does it take for Sonicstage to be freed from DRM?)
Now, I have an iPod because:
-gapless with MP3 and AAC (no need to be locked into a propietary format)
-iTunes is a much better music management software compared to Sonicstage, plut it's unicode
-in the event I switch to Mac, I know I can still use my iPod.
Just look at Sony USA. They don't even bother to release the new Sony DAPs in the US. As for MD, it's clear that Sony will abandon it sooner or later, with the RH1 being the only unit released last year. Don't get me wrong, it's still a viable platform for good quality portable recording. However, as a consumer music player, MD/HiMD is not a viable option anymore.