It was used quite a bit for a while, then fell into disuse.

It's my opinion at least a portion of the reason it fell into disuse was the lack of promotion. The most common complaint I heard about Chat was "I don't go there because nobody's ever there." If there were a regularly-scheduled Chat session or two, maybe people would have a reason to be there. Of course, the second most common complaint I heard about Chat was "I went there and people were already having a conversation; I didn't want to interrupt." Typically, Chat etiquette states that one shouldn't expect to be having a private conversation in a public chat room (there is usually a way for private person-to-person communication outside of the publicly-viewable channel, though) and there's nothing wrong with anyone entering a room and giving out a general "Hello!" even if there is other traffic in the room. Perhaps a few threads on how Chat works would help ease people's concerns.