lots of reasons, but around that time etsy invested heavily in infrastructure and tools like statsd resulted from it.
the last few years the focus has been mostly on product, and product teams usually don't produce the kind of significant technology contributions you're talking about (huge generalization there obviously).
this is more of a personal opinion, but my experience was that the last few years etsy has focused less on technical solutions to problems and more on "people solutions" - if something is inefficient they look for non-technical solutions to that problem, sometimes fruitlessly. as you can imagine in that environment, things like statsd don't get made.
Code as Craft was one of my favorite blogs back when I was a junior dev.
It's not unfeasible.
It would be a scenario that could explain both portfolio degradation and community leave, and not too uncommon. Of course, it could be unrelated and this is just speculation.
that was not my experience at all. officially, open source was encouraged because it raised etsy's stock in the tech community, which was beneficial for hiring.
unofficially, middle managers discouraged it because it detracted from shipping quickly (which made them look good to upper management).
obviously the CTO/etc. could've just been paying the engineers lip service about open source, but they seemed to genuinely support and encourage open source contributions. they certainly celebrated when open source contributions actually happened.