I think the main problem with Mathematica is very simple: the Notebook interface tries to be user-friendly, and tries to enable literate programming. It makes doing straightforward calculations very easy. However, this belies the fact that Mathematica is an extremely complex system, and it requires a great amount of mathematical sophistication to understand how it works. Anybody that's not a mathematician or a computer scientist by trade (or by calling) runs head first into the exponential learning curve (Fig .1). I don't know anybody in my scientific community (Applied Physics) that is proficient with Mathematica beyond the basics they need for quick plots and integrals.
This disconnect between the friendly interface and easy basics and the nighmarish syntax of rules, patterns, holds, folds, maps, delayed vs non-delayed, etc once you get into things that are just a little more complex leads to a tremendous amount of frustration. Furthermore, it is often hard to figure out which constructs are imporant and efficient for what I want to do, and which are syntactic sugar that's only useful for cellular automata. What's worse is that while every individual feature is reasonably well documented, there are no tutorials that I have found that tell you how to use them together to write efficient and maintainable code.
As a result, those of us that have smacked their heads against these problems long enough just give up and settle for Matlab -- surely much more specialized, but also much more intuitive, and for many people also much faster in terms of computing time. And most engineering students don't even bother with Mathematica -- Matlab is the de facto standard, and that's what everyone learns.
So my message to those ardent supporters of Mathematica is this: think of the vast population residing in the middle ground between wanting to do easy plots and integrals, and between wanting to conquer the world with cellular automata or power through sophisticated arbitrary-precision and symbolic calculations. We want to like Mathematica, but find it hard -- so please give us some guidance before we all defect to other software.