Inflation and the cost of labor killed pinball. The death of arcades has to do with home console's increasingly powerful hardware and software development cost of 3d.
Arcades/video games were seen as a fad. As atari, Mattel, and the like continued to pump out more and more garbage games the public finally got fed up and stopped buying. This lead to the video game crash of the early 80's.
Nintendo's nes brought video games back for consoles and made them viable. The problem is once you get to the mid 90's and the rise of 3d the cost of development sky rocketed. The last great boom for arcades is the early 90's. Right as you are starting to get 3d. Think SF2, Virtua Fighter, Mortal Kombat.
Thing is consoles caught up. Saturn, Playstation, and N64 started to provide a close enough experience. Sure, it was cut down compared to arcades, but the gameplay was close. Video games could no longer be developed by a single person or a small team. The cost of the software soared and arcades start using slightly upgraded consoles. This reduces development cost and allows the games to be ported much more easily. It also removes incentive for people to go to arcades when they can play at home.
Inflation is the other factor that killed arcades. Games hit 25 cents in the 80's. Start of the 90's and games started costing 50 cents. This was fine, but for whatever reason we have a hangup when a game costs a dollar. .50 cents in 1990 is the same as .92 cents today. Despite this many people will not drop a dollar to play a game.
Pinball? Pinball had to deal with the death of arcades, the rising inflation, and the mere fact that by design they are labor intensive to maintain. Even if Arcades were still thriving pinball does not make money and you can read about that in any number of posts on pinside and rgp from Operators who explain the economics.
So, no get off your soap box about VR. Until you have tactile feedback it is not going to touch the pin market. They are catering to very different experiences.