To be fair, the Chunky Pixel craze didn't really kick in (that is- become apparent that it was going to be the way to do things in Computer Games) until Doom in 93. (Wolfenstein was a sign, but Doom really did it).
ECS was released in 92.
It would be interesting to know whether Commodore was taking about Chunky designs at all seriously before that.
I agree, more chip RAM should have been an option.
desiv
Actually ECS was 1990. AGA was 92, which is probably what you meant

Doom was released the very end of 1993. By then, there wasn't really anything that could be done as the upper management had squandered it.
People like to jump on this or that technical detail to be the one true answer, but I dont think the answer lies there.
Watching the deathbed vigil, Haynie mentions that the 500 was still selling well when it was cancelled. CD32's sold very well, despite computer geeks being focused on specs. The problem was they couldn't get enough out there to sell.
The hang up on pure specs and processing power never made as much impact in the real world as computer geeks like to think. Otherwise, the nintendo would have vanished, windows would never gotten off the ground, and nobody would buy a gaming console today.
Most people don't really care about those things.