I think the KDE developers caught on to the fact that consumers have to WANT to use the desktop, not just use the desktop because it's there. KDE4 reflects a lot of that design. It's functional... and sexy.
To me Gnome is stuck in a clique. They don't actually satisfy a need on the desktop market. The experience isn't pleasant to use. They don't accept outside code. To me Gnome exists largely on the whims of people already using Gnome. I don't see a clear design goal from Gnome, a direction for where the desktop WANTS to go. There might be one, but the dev team is horrible about communicating it.
All other desktops have a goal. Whether it's to be as small as possible, least intrusive, lightest on resources, and so on, the various Box'es, XFCE, KDE, IceWM, E17... each has a goal for what they want to do.
Maybe Gnome does need to die to help Linux grow. There's little doubt that KDE4 will replace KDE3. It might not be until KDE 4.5, or after, but it is going to happen.