Commercial or not, it was presented as a movie and critiques, along with comparisons to Follow That Bird, are inevitable. Besides, the fact that Grouchland was in the title as well suggests that it was at least not all about Elmo. Therefore, expectations about other characters are reasonable.
I also get the sense that the film was just rushed out the gate to get this out in time, even though it wasn't a money making film in the end. Come to think of it, I have the same problem with this film as I do Letter from Santa. Seems like they could have been more inclusive of other characters with one or two more rewrites, but they didn't have the time for the project to develop. It just goes back to my original comparison. FTB was made as a legitimate Sesame Street movie, EIG was made as a cash grab. And as cash grabs go, it's okay. The biggest mistake was basically having Big Bird, Gordon, Maria, Telly, and Oscar in the film to help find Elmo, and then just dispatch with them in jail for most of the rest of the movie. I understand that Frank Oz was only available for a couple smile and waves, but they certainly could have done more with the characters they used.
Other than that, I'm sure if this movie was a success, it would have probably followed up with an Ernie movie (Sing and Snore Ernie, you see). Preschool films
kinda don't do well at the box office. If Elmo in his rise to fame couldn't pack them in, Barney at the tail end of his second wind couldn't, and that disastrous and completely unknown Oogieloves thing wouldn't. Even FTB was a cult film for fans of Sesame Street. Shame we never got anything close to the original Muppet movie trilogy in Sesame Street form.