The main reason it hasn't been commercialized is that the fruit itself is very finicky. It took me a whole year to work out a procedure and formulation. Another company is working on bioengineering the active protein, and raised $6.9M 3 weeks ago so I wouldn't say all hope is lost in miracle fruit.
There is actually a really interesting conspiracy theory of how GD Searle broke into the offices and sabotaged the original company commercializing miracle fruit back in the 70's. You are right, they tried telling the FDA that miracle fruit would make kids drink battery acid, but that was all corporate BS because they were afraid of the competition it would bring - kids were enjoying miracle fruit sweetened popsicles more than regular popsicles.