Considering that getting children and families to watch a show is actually the most basic way of getting high ratings, the decrease in the show's ratings, even in Japan, seems to set off a large amount of warning sirens about the direction the Pokemon Anime is going to go, as it might end up cancelled soon if it keeps up. TV producers tend to get very desperate when their ratings collapse. For example, West Wing included two scenes of Donna and Josh sleeping together in one episode apparently out of a desperate attempt to save their ratings. Heroes had something similar, where they had Claire Bennet, for no reason at all, changed to a lesbian/bisexual and hinting at a romantic relationship with Gretchen, and the series was on the red by that point. Both times, it only further ensured its cancellation. I fear that the creators of the Anime will end up pulling a similar trick, especially with the poor ratings of AG in Japan (even Johto did better ratings wise), and I suspect DP (although that's based on the early portions of the saga).
Now, that doesn't necessarily mean that the Video games will be cancelled as well. Just look at Mario and Zelda: Those games had cartoons via DiC, and even when those cartoons were cancelled, they still had enough popularity for their franchise to continue in spite of that.