The Moulton has a cult following. When you design a bike, your wheel size is sort of a fine balance between the right size for your bike, and ride quality. A 16 inch wheel is very small and is appropriate for a commuter/folding bike. The issue with a 16 inch wheel is that with an adult rider (and maybe bags on the back), you'll get a harsh ride. You need to find a way to smooth out and soften the ride with a 16 inch wheel.
The Moulton rather ingeniously solves the issue with suspension. You get the small wheel, a tire of moderate (reasonable) width and pressure, and the suspension smooths out the ride.
Now take the Raleigh RSW folder. It had small wheels, but Raleigh could not use the Moulton suspension system at that time. So Raleigh's solution was somewhat cheaper - wide, low-pressure tires. The Moulton solution was much better because those RSW tires tended to bog down the performance of the RSW. It also didn't help that the RSW frame was not as ergonomic for an adult rider as the Moulton. The Moulton was the better bike.
Raleigh finally did solve the small commuter/folding bike puzzle with the folding Raleigh Twenty of the 1970s. You wouldn't think there would be a big difference between 16 inch wheels and 20 inch wheels, but there is. The Raleigh Twenty is a legend among folding bikes, right up there with the Moulton. But the Moulton shows that an innovative designer could out-solve a bike company like Raleigh in some instances.