Apple designed the language to ease the move of experimental (typically Lisp or Smalltalk) code into production (where it had to run faster, in less memory, etc). Tey wanted a Lisp that ran as fast and as memory efficient as C, so that they could write the OS in Lisp.

That's why they put a lot of thought into the sealing functionality (http://jim.studt.net/dirm/interim-36.html) and into limited types. For example, you can store a 'integer between zero and a hundred or letter of the alphabet or NULL' in a single byte. Expressing that in C is cumbersome, as you would need wrapper functions or macros, would need to remember using them, etc. A sufficiently advanced Dylan compiler could figure out a representation of its own.

Pascal-like syntax was bolted on later when they tried to bring the compiler to the masses. That, in turn, required serious thinking about the macro system.

And no, that didn't work out. There was a prerelease development environment, but they never managed to get this mainstream.