>> What made Wayland unsuitable to be used on mobiles?

From the old blogs it sounds like they really wanted buffer memory allocation done in the server/compositor due to limitations on some ARM GPUs. Wayland was never about resource allocation and doesn't want to be. One of the complaints about X was that it had a bunch of OS features like memory management, font rendering, etc. At a high level I agree that it seems dumb to have memory management in the display server, but that just in principle. In practice I can't say if the mobile concerns would be best addressed with Mir or Wayland, but I think it has been addressed in both. You can run Wayland on RasberryPi after all.

I'd say nothing, Wayland is used on mobile and embedded, the reason Canonical made Mir was so that the had full control/ownership of the display solution and thus could charge a license fee to proprietary vendors who wanted to use it.

Nothing inherently wrong with that, but for someone outside of Canonical it's hard to be interested in a competing solution which only exist in order to pad Canonical's bottom line.

Which was also the reaction from the rest of the Linux ecosystem.

In principle it's not, really. Sailfish OS is a nice enough system and Wayland seems to be working well enough for those guys. Jolla's problems seem to involve competing against Google and Apple, which would be hard enough even if both did not already have an established user base.