> Few investors were interested in betting on a hardware startup, or dealing with the headaches that often come with manufacturing goods.
Let's assume "investors" are people with some knowledge of funding hardware based products. This group of individuals is going to look at the product (the upsides) as well as the challenges (the risks). A project might have tremendous upside on the product side, but an experienced hardware investor is able to identify the risks. I'm not a hardware investor, but anything involving wireless (even Bluetooth) automatically sets off warning buzzers in my head. I'm sure hardware-oriented VCs looked at this product and saw their own set of "uh oh" problems, thus they decided not to fund it.
> Migicovsky said he’s more adept at pitching to consumers than to venture capitalists.
I'm not sure Migicovsky is entirely aware of what he's saying here. This could be restated as "I'm more adept at pitching to laymen than people who are familiar with the challenges." That's scary.
At first glance, this appears to support your hypothesis: that one day, this whole thing is going to come crashing down. However, I believe you underestimate the pool of fools ready to part with their money. I don't really mean that funders of this project are fools, just that by some people's perception, they're fools for taking the risk.
Stated more succinctly, I believe that on the broad scale, there are a sufficient number of non-risk-averse individuals to sustain Kickstarter for quite some time. I believe this will remain true, even after some catastrophic funding failure.