That depends on Sony and all Sony has said is that they dont care very much.

It totally could though. Aslong as Sony keeps supporting it and incentivating developers/publishers to do the same.

All the support comes from Japan though. Western developers dont have the gall to make anymore portable games. They prefer the easy buck of the person that uses a phone so they can play bad games.

Sales of the Vita have been up recently but I'm not sure if that is due to the holiday season or people purchasing it for remote play with the PS4. Would be nice to see it get a 50,000 baseline(hell even a 40,000 weekly baseline worldwide).

No. Sony need to make a brand new handheld if they want to continue to make handhelds.

yet it has failed as a single generation handled Lol

It could be a good idea, but Sony should relaunch it with better marketing, better price, lower price for the memory cards and a regular flow of first party games, not only as system sellers, but also to clearly tell both users and third party devs and publishers that the platform hasn't been abandoned. And possibly a model restyling, that could have some extra features, say, smartphone function and others, but it should avoid at all costs to split the user base introducing game incompatibilities with the old models, so if the HW will be more powerful, that power will have to be used only for optional non-gaming features or to allow running scalable games at higher settings on the new model while they should also perfectly run at original settings on the old ones.

I think the price that you can get them for in the UK is fine. £130 with 10 games and a memory card.

However, scrapping the memory card requirement entirely in a future model would go a long way, given how many people on here seem to find it such an issue, and it'd certainly make sense given how cheap the actual memory probably is for them, to just do a model with a decent chunk of storage built in.

A new slew of first party titles would be nice. Though I don't think third parties are really bothering with any handheld now barring the odd title. I think they more need to get out the message of the games the system already actually has, preferably with physical releases, even if  they're compilations of the highest rated titles on the system.

About the price, they should do better prices also outside of USA, UK and Japan. Here it's still 199 Euros list price with a 8GB mem card and 8 games, currently discounted in some online stores down to 169 Euros, little more than £130, but it's still a timed offfer, and still above the 150 euros psychological threshold, not to mention that Nintendo offers quite a lower entry price with the 2DS. Although it has good prices in the three best selling countries, Sony consoles and portables rely a lot also on the lower selling rest of the world.
I agree about the rest.
Once the price is right and the game library large enough, what will be left to fix is marketing.

Vita could very well be a 2gen handheld. The main issue with the vita us that the memory cards cost more than the damn device itself. Sony need to address this

No. 

It likely won't become much cheaper to develop for because it will be using older software technology which won't be the norm but it's hard to say.

A number of other technologically better handhelds have come and gone over the years. Atari Lynx, Wonderswan, GameGear, NeoGeo Pocket. That's the company the Vita has.