I can't for the life of me figure out why LPG isn't taking off here.
Two most likely reasons I can come up with are;
1) the government here is too busy worrying about the trivial things and spending all their time in parliament bickering and taking cheap personal shots at each other, to even get around to thinking of the benefits of LPG, and therefore people aren'y really informed about it. It costs a lot to convert and there is no goverment incentives to do it like there used to be. People generally aren't forward thinking enough to do something like this all on their own.
2) Cars here in NZ are very much more disposable than they were, thanks to flood of used japanese ####boxes that crowd our roads. People buy a 5 or 10 year old import, and might only keep it for 4 or 5 years and then it is basically buggered and not economic to keep. With the cost of LPG conversions in the $4-5K range, and with most Jap imports being quite fuel efficient, the payback period can be quite long. It's often not worth it.
Other than that though, there are real benefits, especially for bigger cars. It's cheaper and cleaner than petrol, and better for the engine. What problem do people have?