I imagine that the convenience of PHP is why its still going strong. Simply because you could have a html file with some php tags in there and throw it up in a directory on your webhost and you now have a "dynamic" webpage.
The problem is that most popular PHP applications (and, by extension, most PHP-driven sites) are far more complex than that model allows for. It's telling that HTML appearing before a <? tag is generally considered a mistake. :)