I gotta disagree on two counts.
Firstly, I don’t think that it’s the lack of a wizzy editor that kills wikis. It’s the lack of overall wiki navigation and structure. Some wikis provide categories and categorical navigation, which is good, but not good enough. Socialtext does well here, but it costs (and the free playground doesn’t appear to be working, or I’d link to it).
But, as I mentioned above, I think you’re correct in saying that there is a fundamental problem with wiki. I don’t think wiki formatting, or text formatting in general, is the problem. 🙂