They screwed it up right from the start? Strange that, as it wasn't even developed by SOE at the start. Also, right from the start, Lucas Arts were in control and still are. It is not really down to SOE and never has been. Tradeskill borefest? Just one of the best player driven ecconomies ever made combined with some of the best PvP to have existed. Borefest? Right ok.
Ah yes the Star Wars universe is well noted for its well managed economy

They were forced to change it because Lucas Arts had a panic attack. Other games were doing better so they got greedy and wanted more. It's as simple as that.
Lets not kid ourselves. Lucas Arts told the developers exactly what they wanted. Also, 300,000 subscribers is not a niche market, in the MMO market that is huge. In fact it is the 8th most popular MMO ever made, if I have counted right. SWG was a Lucas Arts cash cow - they knew the Star Wars brand would make them lots of money. And it worked. Koster just happened to be one of the people that was employed to make it.
300k is nothing when you consider the game had the Star Wars IP behind it. It tempted many suckers like me to try it.