Well, we will never know now.....
But UI is just a matter of habbit. Sure, for those of us who tried everything we can debate and pick one over the other. But back then when average joe was introduced to iOS and android he would be equaly confused with maemo also. Middle aged people were affraid of smartphones then and now every grandma knows how to use them.
And nokia was betting on that fear and continued to push their worst UI, S60, that everybody was familiar with. And when they reilized that people do like touch UI they halfbaked it to S60 and we know how it ended.

I remember an article where it was said that S60 advocates boasted that they can create touchscreen UI for S60 in matter of weeks. Probably the high management bought that lie and S60 became "sacred cash cow". Having read and heard some things from inside the company, I'd put Nokia's downfall to these reasons:

- Higher management was both arrogant and misinformed (as they didn't want to listen to any bad news from lower management), so they bet too much on S60 and changed that too late
- Nokia was in dysfunctional state. Middle management was so bloated that nothing could get done, new ideas could not get through and this was evident on MeeGo development when it was finally decided that MeeGo will replace aging S60. Suddenly the whole bloated middle management was behind it, every manager trying to make themselves important which hindered the development so that devices would be late and cancelled (for example, N8 was originally supposed to be Maemo/MeeGo device). WHen decision was finally made to switch to Windows Phone, MeeGo guys could finally do their job and release the N9.
- Nokia used to be a company driving the change and making the new innovations, but later that changed to cashing out and avoiding risk mindset. Want to kill a growing and innovating company? Put a bean counter to run things...
- Public image became so tarnished that at some point everything Nokia did was portrayed in negative way. When that drive was on, there was not much Nokia could do about it. Even if it had adopted Android, it would have been portrayed as "too little too late" or something like that. Group think is funny thing... now nostalgia has made it again possible to sell Nokia brand again as cheap Chinese stuff is not that new any longer and Apple has switched to bringing little evolutionary (though usually working and well executed) improvements over new versions.