I think that Commodore could have never won the battle.
On the PC side you have one big company constantly researching to increase computing power, a big bunch of large companies researching on optimising data transfer within the mother board and all its components, a bunch of very big companies struggling to deliver the best video performance ever, one enormous corporation developing an OS plus many communities developing powerful free OS's, etc, etc. You all know what and who I am talking about. Do you seriously think that Commodore on its own could have come up with all the massive amount of technological advances that all of these dedicated companies have come up with? I very much doubt so. Sooner or later, and no matter how much Commodore would have brought the Amiga forward (had it done so), Commodore would have been catched up with and surpassed.
In other words, and in terms of how many efforts could have been put into enhancing Amiga and PC, the Amiga is and was a boat powered by a few people rowing, whilst the PC market is and has been a larger boat powered by a myriad of powerful engines. I fail to see how Commodore could have survived in such an environment no matter how many efforts they would have put into the job.
I agree that AGA was too little, too late, but one single company could not have done enough and fast enough to catch up with Microsoft, Intel, ATI, and NVidia, all toghether (and this is to name just a few companies). Yes, it could have adopted Linux as standard and that would have rid Commodore of the burden of constantly updating the OS, but there would have been too many giants to fight against for one single company like Commodore.
Greetings,
Ed.