If they released a cheap or impressive enough VR headset, I doubt desktop or face-tracking would matter. But I think the next best thing, a decent headset with an open platform that enabled such things, would’ve saved them.
I am glad they don't, the headset should be a general computing device first and foremost, launching apps you choose to participate in.
(Meta, I think, fails to understand that the people that most want a virtual space to interact with, to the point of putting up with the limitations of VR tech, mostly want to not look like regular people in that space, because they keep pushing a vision that seems to be a uniform 'normality' even more extreme than the real world)
The VRChat community should consider forming and funding an open source group to re-implement the platform as it will eventually get regulated.
For what it's worth I don't use VRChat, I've just been around the internet for long enough to know the pattern.
There are currently two much smaller competitors that are perfectly usable but lacking community buy-in. Chillout, which is similar to VRChat, with some improvements the community has wanted for years, but missing some of VRChat's (admittedly excellent) homemade functionality, such as better IK code, better bone dynamics, etc. And Resonite, which is more similar to SecondLife, possessing a cross-world inventory system and in-game content authoring tools.