It might have had security flaws that would open up to hack attaq, for instance... or it might be incompatible with the current operating system.
The first may be true, but it's a good bet that new operating systems are written to run "legacy" software.
No, they're not. Legacy software may run because Microsoft doesn't change the software too much; but in every new OS they do say older programs may not work. XP and Vista include a "compatibility mode" which allows some older software to work, but there are still a lot of people running Win2K and WinNT or even DOS because the apps won't run on XP or Vista.
Mac OSX would only run older OS9 apps in the "Classic" environment, which was a software/hardware emulator. That allowed users to transition to OSX, but Classic has been removed from later versions of OSX and will not run on Intel based Macs.