"... if only I had waited until turn 2 before I tried to pass those 6 other players ..."
The online play isn't dead, it's just changed, from what it was back in 2003 when I started with S1. As mentioned there are still a large number of players online, more so than most other racing games.
I always knew that with just 3 developers, progress was going to be slow, and my guess back in 2005 was that S3 would get released in 2009, which probably would have been true had it not been for the tire physics redo.
I've never understood why they call it "alpha", since it's really a "beta" release, since the public or a sub-set of the public are testing the game, as opposed to an "alpha" release which is "in house", hired game testers, and/or consultants, but not the general public.