I think Kiko's biggest downfall was his mentality. It doesn't matter how talented you are if you don't have the mentality needed to succeed at top level and when he blamed Barcelona when he left it became evident that he don't have it and that's what has been shown at Real Madrid Castilla as well, a team who were in the slump the entire last season, but he was still not deemed as good enough for them.
I've seen cases of that personally as well. Seen players who were a lot more talented than someone like Mats Møller Dæhli, but they were simply not serious enough or didn't possess the mentality needed to succeed at the top level and therefore their career didn't go anywhere.