Ryan Law brought up videogames. This past console generation offers a good example. The Playstation 2 was weaker, graphically, than the Gamecube and the Xbox. (It cost more than the former and less than the latter.) Moreover, it was plagued with hardware problems--after a couple years of use, a huge majority of first-generation PS2 owners reported numerous Disc Read Errors; their PS2s simply stopped reading games. Sony went as far as to remodel the console entirely, on top of settling a major class action lawsuit (in which they ceded no admission of hardware failure).
However, it wildly outsold the Gamecube and Xbox. It was, in a big way, the lowest common denominator. It could play old Playstation games, so users had a built-in library. They could even use their old controllers--a popular, if standard, design based on the Super Nintendo controller. The Gamecube tried a more innovative layout, with a large "home" button and surrounding buttons designed to accomodate thumb-sliding. The Xbox's original controller was considered too big for most users. As for format, the Gamecube used minidiscs. They did not have as much capacity as DVDs, but they loaded much faster. The Xbox used DVDs and a hard drive (which made it the choice console for game pirating). The PS2 played CDs, DVDs, acted as a DVD player right out of the box, and came out before the other systems.
So the PS2 was a very conservative console. It did a lot of comfortable things, and even though Nintendo and Microsoft's systems were unquestionably more powerful, there's no doubt the PS2 "won": it attracted the most software, as the lowest common denominator would be expected to do. Meanwhile, developers who spent their time on the other consoles enjoyed huge game sales from their smaller user bases: Itagaki and Tecmo on the Xbox, Nintendo (of course) on the Gamecube, etc.
As for the generation before that, I think the PlayStation beat the crap out of the Nintendo 64 because it was much easier to pirate games. :-)
Today my coworker Marcello pointed out to me an interesting anti-majoritarian effect. There are three major interpretations of probability: the "subjective" view of probabilities as measuring the uncertainty of agents, the "propensity" view of probabilities as chances inherent within objects, and the "frequentist" view of probabilities as the limiting value of long-run frequencies. I was remarking on how odd it was that frequentism, the predominant view in mainstream statistics, is the worst of the three major alternatives (in my view, you have to presume either uncertainty or propensity in order to talk about the limiting frequency of events that have not yet happened).
And Marcello said something along the lines of, "Well, of course. If anything were worse than frequentism, it wouldn't be there." I said, "What?" And Marcello said, "Like the saying that Mac users have, 'If Macs really were worse than Windows PCs, no one would use them.'"
At this point the light bulb went on over my head - a fluorescent light bulb - and I understood what Marcello was saying: an alternative to frequentism that was even worse than frequentism would have dropped off the radar screens long ago. You can survive by being popular, or by being superior, but alternatives that are neither popular nor superior quickly go extinct.
I can personally testify that Dvorak seems to be much easier on the fingers than Qwerty - but this is not surprising, since if Dvorak really were inferior to Qwerty, it would soon cease to exist. (Yes, I am familiar with the controversy in this area - bear in mind that this is a politically charged topic since it has been used to make accusations of market failure. Nonetheless, my fingers now sweat less, my hands feel less tired, my carpal tunnel syndrome went away, and none of this is surprising because I can feel my fingers traveling shorter distances.)
In any case where you've got (1) a popularity effect (it's easier to use something other people are using) and (2) a most dominant alternative, plus a few smaller niche alternatives, then the most dominant alternative will probably be the worst of the lot - or at least strictly superior to none of the others.
Can anyone else think of examples from their experience where there are several major alternatives that you've heard of, and a popularity effect (which may be as simple as journal editors preferring well-known usages), and the most popular alternative seems to be noticeably the worst?
Addendum: Metahacker said of this hypothesis, "It's wrong, but only sometimes." Sounds about right to me.