I think that you need to rewind a few years to get a better perspective.
In the 1970s, Renault made conventional family cars and had not been circuit racing for 60 years. Somebody thought the company needed an image refresh so a modest racing programme began. Renault had a 6 cylinder production engine which would make the basis for F2 and a 2.1 litre turbo Group 6 cars. These efforts were increasingly successful and the company decided to make an F1 car, although winning Le Mans was the main target initially.
When putting together the F1 plan, Renault made all of the "wrong" decisions: an inexperienced F1 driver, a turbo engine, Michelin radial tyres. "Very brave" was a popular description of the project. It couldn't go well and 1977 was a challenging first year. 1977 was also one of those years when almost everyone made decent F1 cars. One of the things the team got right, and which would not have been obvious to fans, was to earn technical support from wider French industry. When Renault won in Dijon in 1979 (a race more famous for the second and third place battle), critics quietly muttered that they thought the turbo idea was right all along. Hindsight is a wonderful thing...
I think that non-technical factors led to failure to win a world championship. TV audiences were growing and F1 was attracting new sponsors and participants. The FISA/FOCA war had changed team funding. Independent constructors had raised their game and Ferrari was reinventing itself. Ironically, Renault's competitiveness made everyone else come up with new ideas and go faster.
taran makes a good point about French politics. In theory, state ownership of Renault meant unlimited funding, but it also provided 50 odd million critics who were paying for the team.
Regarding the turbo engine, being first with a technology often creates a short term advantage. A few years later, some design flaws are obvious but too much has been invested to fix them. When creating the specification for the TAG-Porsche engine, John Barnard had the advantage of a clean sheet of paper. The engine was designed to his requirements but F1 aerodynamic rules were changed. By the time Porsche built the engine, Barnard would have asked for something different. If you ask me, Renault did a good job.
Renault got it right as an engine supplier to Lotus and Williams. The cars were always called Lotus-Renault or Williams-Renault, generating huge publicity in the English-speaking world. Shortly afterwards, Peugeot decided to get involved in circuit racing.
Renault may not have won a world championship on their own, but they succeeded in other ways. And they did it the hard way by making F1 cars that were different.