Islandwood wasn't really mentioned because there were working examples of Astoria. While Islandwood is the much better project, it's kind of hard to get excited about something that still seems to be vaporware.
Yes, there are examples of Islandwood (CandyCrush), but it's a lot more difficult to compile Objective C code to WinObjC than it was to run the Android emulation.
Non developers typically care squat about how difficult a porting/programing task is, and considering there are already Islandwood ported apps in the store, I'd say Astoria is far more deserving of being called vaporware than Islandwood.
IMHO there is more too it than that.
AFAIK you are the first person on WCentral beside myself to say that Islandwood is the better technology and more important project. A week ago such a statement would have been mostly ignored and sometimes viewed as a little bit crazy. Anyway, whatever that was I'm glad it's over.
In regard to the technical points raised:
I never bought the idea that Astoria is so much simpler to use. The idea that recompilation is such an issue is like saying a cook would find a dish complicated because it requires a frying pan (big deal not). We also seem to keep ignoring that for an Android app to not just run, but to run CORRECTLY, developers also need to get out their compilers (i.e. to deal with Google Play issues). The real fun starts when an Astoria ported app doesn't display the desired runtime characteristics (as a result of partly running on an emulation layer), or not integrating well with WP's security model. When that happens, Astoria is instantly far more complicated than Islandwood.
The issue with Islandwood has nothing to do with the necessity to recompile. It's the fact that iOS apps must be slightly modified. For example, it's very common that developers would have to hide the software back button in the ported iOS app, and hook up the same functionality to WP's hardware back button.
For me the biggest question is why they are dropping Astoria now. It was obviously going to torpedo UWP (Astoria ported apps aren't universal) and therefore represented a threat to the entire W10 ecosystem. It should have been killed long ago.