This is only a guess at the answer but perhaps a lack of literacy in churches caused a decline in psalters as Watts' tunes are more prone to rhyme thereby being more memorable lending to people who do not read.
In my country, a survey showed that 75% of our island inhabitants were illiterate in 1930.
Question: Does anyone know of a Psalter in the Spanish language?
We sing some psalms in spanish but we don't have an organized book with only psalms to sing in the form of a hymnal. But our hymnal contains some psalms.
I would much like to sing psalms also but I would not like to remove all of hymn singing though because of (similarly as one of the above posts), the verse--Psalms Hymns and Spiritual Songs. Spiritual Songs as well as Hymns should be permitted also imo.