The Expos were done in by the strike and two ownership groups that failed to invest in the product.
In 1990, the A's and the Royals were both in the Top 3 for overall payroll. In 1995, they were small-market teams. Montreal never spent like Oakland or KC, but like the A's and the Royals they were not the penny-pinching outfit they became after the strike.
The club was owned by Charles Bronfman until 1991 and the family business (Seagram's) helped pay the bills. The new ownership pulled the purse strings tight after the strike and eventually sold to Jeffrey Loria, who I am sure that there is already a special little corner in hell reserved for. Loria eventually finagled his way into control of the Marlins when Bud Selig decided that Washington DC deserved a third shot at supporting a baseball team more than Montreal deserved a competent ownership group.
Meanwhile, the Expos had never captured Montreal's fancy the way that the Canadiens still do, and after the strike there was a lot of bitterness toward MLB. Olympic Stadium remained a terrible place to play. Ownership made it clear that it was unwilling or unable to put a quality product on the field. The results were predictable: fans stayed away.
Montreal can still work as an MLB town, but only with an ownership group willing to do the dirty work to get a new stadium built. I suspect that Selig would be more than happy to threaten Oakland, Kansas City or Tampa with relocation the same way he once threatened Montreal.