It had an unbelievable amount of commercials on Nickelodeon. I'm not sure that was the issue. I think the biggest issue was price. It was an expensive hotel. For families who are going to the parks, I don't think the hotel offered enough to justify that price difference. The Disney/Universal premium is partly for the transportation / in-park perks that you get for being on-site. Nickelodeon couldn't offer any of those.
And, in Orlando, I'm pretty sure there isn't a market for Great Wolf Lodge style resorts like Nickelodeon.