There's honestly only one thing I've seen ever fix a mixed, decaying game and that's switching to a free to play model. Maybe that's what Badspot's intention was with the hats but I don't think he's going to do anything to fix it.
Let's face it. No one here buys games that have mixed ratings unless a friend explicitly asks you to buy it, or they buy it for you. However, I'm sure a number of you have tried a free to play game that had mixed ratings. Because there isn't much to lose there.
That on top of the fact that 2 hours isn't enough for someone to experience Blockland. They probably pop open some single player stuff and just see the tip of the iceberg that the default game is with no players. Then they go on to join some popular server, which is usually a poor experience for a new player. These super cool fun servers we tend to make and populate don't really present the game's mechanics very well. And that's usually because we're just focused on presenting our own mods' mechanics, for good reason. We're all already very familiar with the game's base mechanics. These people are going to end up refunding the game.
So my proposal:
Free to play
Some sort of microtransaction system
Reward the players who have already purchased
Rework the ID system to compensate for the theoretical end of supply
Could do it similar to TF2, people who already owned the game are 'legacy' members, being able to keep their ID, and getting a special gift. Any members who make a minimal transaction get a new ID as if they'd just bought the game. Any non paying players will have something like their steam ID in place of a BL ID. It'll be a bit harder to moderate servers but we've got quite enough of an active veteran community to establish a baseline for behavior and administration.
As for the forums... Give f2p members their own forum section (general and help, separate from the existing general and help to avoid clutter) and stick a couple of moderators specifically for that section. If someone takes an interest into modding but doesn't want to pay (for some reason), maybe give them special access to posting in S&R, mod disc, and the files category.
The steam reputation will still be stuff. But other f2p games with stuff rep still get new players.