1) The initial version had some problems but was fine, I think by v5.2. Regardless, by WordPerfect 6.1 for Windows, most software reviews picked WordPerfect as superior to Word. I and many others I know preferred WP into the 2000s, at least. It was good software.
2) IIRC, a major reason Word became dominant was because of anti-competitive practices by Microsoft. Microsoft required computer manufacturers to purchase an Office license for every Windows license. As a result, every new computer came with Office installed. I believe Microsoft was convicted of violating anti-trust law or settled with the government, but too late for WordPerfect. My memory is vague on this point, however, and I'm surprised nobody else mentioned it.
3) Also, IIRC, Office was easier to integrate with other software, in part because it was object-oriented and because of Visual Basic. That made it appealing in the corporate market.
Finally, many here wonder why the legal industry preferred WordPerfect for so long (as did government). IME the reasons were A) Legacy; attorneys were heavy users of WP for DOS, when it dominated the market; B) Word offered no benefit in return for retraining users and converting all the legacy data, customizations, and macros; C) WordPerfect was better for power users, due to the fine formatting control, and many legal secretaries and others were power users. I recall one legal secretary's response to Clippy: 'No I don't want help formatting a letter -- I've been formatting them for 20 f!@#%! years!' D) Government liked WordPerfect's built-in SGML editing. I always thought WP should have used Reveal Codes and some updates to sell itself as a low-end XML or HTML editor.