What are the domainant issues working against Namecoin today?
Namecoin is worthless and doomed to fail due to their policy of having the domain registration and renewal cost next to nothing.
With the current Namecoin generation rate, you could register or renew ~2500~5000 new domains every 10 minutes, which doesn't make sense.
Since registering domains is basically free, anyone could cheaply squat them all. And no one bothers to to it precisely because it could be done so easily.
This is the most prominent reason why Namecoin failed. Other reasons are that they didn't even realise they should have considered what to do when NMCs would stop being generated, and that using Namecoin is actually useless since no popular DNS server supports it (as opposite to Bitcoin which can be exchanged with other currencies, i.e. it works as a currency, its intended goal).
What can be done to correct those issues?
It won't happen.
That said, anything short of resetting it changing the rules to:
- namecoin fixed (non-decreasing) block reward
- domain registration and renewal fixed, and much higher than now (either fixed, or somehow automatically adjusting)
And convincing some popular DNS server (126.96.36.199, 188.8.131.52) to support it.
Obviously such a thing won't happen: if it could, it would already did.