I realize hindsight is 20/20 regarding Diesel's babyface flop; however, wouldn't it have been much better to keep Diesel heel and have him destroy Bret for the title, then run him on top as a heel, with Bret trying to retool and figure out a way to beat the big man? Seems like Diesel as an unstoppable monster heel (which got him over in the first place) would have been a better draw. Of course, this would have required either Bret getting the strap back from Backlund, or old Bob never winning it in the first place.
Yeah, the thing is that they had just run with a monster heel champion for the past year with Yokozuna, and Vince was really wanting to get back to the Hulk Hogan formula again for whatever reason. Diesel was specifically intended to fill that role, which is why he was even more of a flop — Vince expected that business would explode with Diesel on top. Had he wanted another placeholder guy to keep things steady, he would have just kept Bret as champion.
The Backlund thing was such a gigantic miscalculation, though. It was an effective character to a certain degree, but not as a main event threat and not as World champion. Especially once he start going into lengthy promos about the state of education. I think actually the Diesel turn might have worked with better buildup and timing, but the people didn't have any chance to figure out that they WANTED him as champion. Had Shawn been healthy at the time, the play would have much more obvious — Bret drops the belt to Shawn at Survivor Series, Shawn dumps Diesel because he doesn't need him anymore, Diesel wins the Rumble and then beats Shawn at WM11 to get his revenge and begin the Diesel Power era. That at least would have given us a semblance of a chase instead of Diesel randomly crushing Backlund in 8 seconds on a house show. Plus it's far less likely that Shawn turns himself babyface so early because he doesn't get the Rumble win or the sympathy heat from fighting underneath the 7 foot monster. Because really, what was up with THAT?