So, true story, the original Nuzlocke actually ended in a failed run! Ruby ended up losing to Steven, and it was represented as such in the comic :0 His loss against Steven (As well as the namesake Nuzleaf earlier in the run) actually led into his future run of FireRed from a storytelling standpoint!
As for the interest in reading a run that loses... Well, for one, if you're reading as it uploads and/or don't know the ending going into it, you don't know whether they win or lose! Though most of the runs I've around seen were successful, there's certainly been ones that were lost, and the suspense of not knowing how it'll go is definitely a draw :d And of course, as seen with Nuzlocke's own Hard Mode series, a failed run doesn't inherently mean that it can't be used for a story - A run that's lost could actually be better suited towards a story with a darker tone, or on the flip side, make for a fun, darkly comedic run, or as in Nuz's case, be used to push forward future runs in the same setting!
In fact, though comics, stories, and sswl runs are arguably the most popular here on the forums, on other parts of the web video and streaming formats are the most widespread - In terms of videos, I've been following Johnstone's randomized Nuzlockes as of late, and let me tell you what, the vast majority of those runs end in a wipe and reset. But there's plenty of humor, suspense, and emotional turmoil to be found in them, and watching him struggle makes the triumph when he finally does beat it that much more satisfying! Honestly there's really nothing quite like watching a man wipe to a Kyogre after saying to yourself the stream before "He needs something to counter Water-types with Ice coverage, he's gonna lose to that."
Failed runs aren't for everybody, and from a creator's perspective it might be more worthwhile to try the run again until you get gameplay that works with the story you plan to tell if you have one in mind, rather than trying to adapt around it at the cost of theming, but they definitely have their potential in the right hands!