How Duke Nukem Forever Failed: Unlimited time, budget and ambition
It seems like the big problem was that they were trying to be on the cutting edge by licensing other engines. But, by the time a engine is available for licensing, the flagship title (Doom 3, Half Life 2, whatever) has already shipped and set the new standard. At the same time, they wanted to have the best looking game available, despite always being behind the curve in their base technology.