I thought it was confirmed to be their lack of resources as well as the results of the Core War and Shattering. Their water pretty much drained away into the two giant craters as I understand it (the ocean having been blasted away to Aqua Magna), and they also lost most of their trees to Bota Magna. They were left with a vast desert for the most part. They were just trying to survive -- it was much like on Mata Nui Island, versus Metru Nui.
Plus, the GBs seem to have basically abandoned them, but prior to that they were ruling the planet (officially anyways), and their creative nature probably had a profound influence on the Agori. But when the Agori saw what that led to, they were undoubtedly horrified and tried to live a simpler life.
It also seems reasonable to me that during the Core War, the most inventive types may have been slaughtered by opponents to try to prevent them from gaining control of the EP first, etc.
So in short, I see no need to appeal to some kind of a mind-altering agent to explain it.
It's the expected result as-is.
Personnaly, I would be inclined to think this come from the creation of the Mask of Creation. Since it was forged when MN was still on SM, it could also be linked to it, and its absence would also prevent any kind of creativity there.
That's not how it works, but nice try.
Creativity never flowed from a source in an object like that.
There's countless ways to disprove this. Try this one; the Vahi didn't exist until near the end of history, yet Time obviously existed before it. Even more obviously, the Ignika also went as far away from Bara Magna as the Mask of Creation, yet Life obviously continued.
And they did make many things. They just weren't making as many of the really advanced things that you need a lot of resources, know-how, talent, and/or factory-type places for.