Were mistakes made during the running of this site, absolutely. Was changing the name one of them? If you look at it from the point of attracting new members and name recognition, then definitely.
However, that is just one aspect. Trying to monetize a website it not easy, and if that website's main focus is nightlife and is named after a big brothel area then that becomes even harder. Google at the time was actively checking that its ads were not on adult content (we lost 75% of our monthly Google AdSense income in a matter of months), and virtually no respectable business will advertise on a site called Nanaplaza.Com.
On top of that there were personal reasons. When I started this I was single and working for an insignificant company. Running a site called Nanaplaza.Com was not an issue. Several years later though my personal and professional situation had changed though and being associated with a site called Nanaplaza.Com would have been a lot more problematic.
Furthermore, running a popular / busy forum takes a lot of work, so at one point I had to decide how to preoceed. Growing it would have meant spending even more time dealing with, perhaps as much as working on it full-time. Which of course would have meant I would not have been able to work anywhere else and the site should be able to fully support me and my family.
At that point, I ran the numbers and I could not see any viable way for me to make even close to enough money of it. Combine that with it having to piss off my wife by spending a lot more time with BKK's nightlife and not being able to get a work permit, and the choice became pretty easy.
As to why TV did flourish, this is of course speculation, but I guess it has something to do with their name and the fact they did not allow any discussions on nightlife. The first meant a steady stream of tourists finding the site (all looking for info on Thai visas) and the 2nd that it was 'safe' to browse at work and without being labeled a 'sexpat/sex tourist'.
Once it had the numbers, momentum pretty much kept it going.
And finally, the blackmail issue. You will have to enlighten me on this, as I have honestly no recollection of it.