Did iRacing Kill LFS?
No, it's not i-racing. It's a lack of any real updates in well over 1 year.
I'd also say that LFS is not dead, but it's slowly dying.
Unfortunately I don't think the Scirocco alone will save it either; it will need more new content than just a car. It will need new tracks, physics updates and improvements to the internal structure (rather than relying in community servers+insim apps).
I haven't lost all hope yet, but every day that nothing happens I lose a bit more. Sad, as this is my favourite bit of software ever.