>> Do you feel the same way about all the "other" linux distros?
> How do you compare a Linux distros and a currency? How do they look similar?
Well they aren't the same kind of codebase, but:
One can fork a linux distro, modify it, and release your own.
One can fork a coin, modify it, and release your own.
>> Somebody will break scrypt? BTC miners will turn their hardware onto scrypt and push the difficulty up and then flee? Something else?
It looks like that you are a technical guy. Miner? Developer? Bitcoin can gain wide adoption. Litecoin is just a copy of Bitcoin. Bitcoin will push LTC out of the market or it is accepted by a very small amount of people who are mining it. Please think as if you are an economist, who cares a currency that fails to gain wide adoption. Will it die?
I know, some people promote it because they are late to BTC game: get rich quick scheme. No more.
Actually litecoin is a fork of bitcoin, not an exact copy. It uses a different hash function called "Scrypt" for proof-of-work validation. This means in theory that it will be harder for the guys with tons of SHA-256 equipment to control the coin. There are some other cosmetic differences as well.
I don't think it's too much of a stretch to say that the crypto-currency ecosystem is well served by some diversity.
Proof of work coins have a pulse, you can see if they are alive by looking for new blocks. No new block = dead coin. I guess you are right, if nobody wants the coins the value goes down, miners flee and are not even lured back by lower difficulty, and eventually you have a dead coin.