This is kind of like asking why Ratchet and Clank doesn't outsell true Mario iterations...
At any rate, a few reasons:
1) Gran Turismo is older. It got it's start 1997. Forza started in what? 04? Usually when the first killer app comes out, it gets the bulk of the sales. Look even at Dragon Quest vs. Final Fantasy - DQ was first, and sells far better in Japan than Final Fantasy does.
2) Gran Turismo was/is on Playstation. It's kind of hard to sell insanely well when your competitor (GT1) debuted on a system with 4 times the install base. That led to higher sales and a better market perception.
3) Marketing. Gran Turismo, due to reasons 1 and 2, is far more well known. Forza, although a better game, has an uphill battle when GT is known as the premier racing sim.
4) Competition. Correct me if I'm wrong, but Gran Turismo never really had any internal (ie, Sony-developed) racing IPs to battle with. In all actuality, Project Gotham Racing was Microsofts flagship driving IP (and before that, Midtown Madness). Forza has had to fight with PGR and other titles, while GT never faced such internal pressure. That allowed the GT series to flourish far quicker than Forza, which as debuted in a pretty saturated racing market.
Having said all of that, Forza definitely has the quality to go toe to toe with Gran Turismo. It's laughable seeing Sony fanboys argue that GT is the better series. If your comparing how "close" racing sims are to the real deal, Forza has always been the more realistic series in every way. Don't get me wrong - GT is an awesome sim, and GT got me into racing sims, but Forza tries much harder to be more accurate. And racers do use Forza just like GT to train on courses. So from that kind of a quality standpoint, FM can establish itself as a good alternative to the GT crowd.
Back from the dead, I'm afraid.
