re: Why did Queen decline in popularity in the US during the 80s?

Queen were open-minded when it came to changing with the times, even if they occasionally did it with a bit of snark (like in the lyrics of the song "Sheer Heart Attack"). News of the World is a really raw album; there aren't tons of layers on that album like there had been with the previous few. It was the most stripped down they had ever been on record. I think this album deceived them; "We Will Rock You" and "We Are the Champions" were a collective smash hit in America, and I think the band and their management misinterpreted just what Americans were into when it came to these two tracks. That is, these two songs basically made sports way more fun, so good for you, lads.

Queen then doubled down on the raw sound yet added synthesizers to a couple tracks on The Game, and while none of the synth-inclusive tracks hit in America, "Another One Bites the Dust" and "Crazy Little Thing Called Love" were two more big American hits for the band.

Now here's where they suffered one instance of bad luck and then made one really bad decision with their music.

Flash Gordon was a competent soundtrack given the nature of the project, and especially given that Brian May is actually an astrophysicist. Certainly this man can commandeer a project that answers the question: What does music sound like in space? The material the boys provided was perfect, but the movie was awesomely bad, and it flopped in America. Not good for Queen. They needed to make a good move.

They didn't.

Hot Space saw Queen doubling down even more on the synth sound and the disco beats, and they really underestimated--or rather, were completely unaware of--Americans' newfound hatred for that type of sound. Queen were a 1970's band who were making disco sounds in 1982, so they got lumped in, for some people, with the Bee Gees at the worst possible time.

Queen took a short break and then recorded The Works. It's a really good 1980's rock album with a lyrical and thematic focus on the then technological and political future, of course with a few good pop love songs sprinkled in there, and for all the reasons mentioned in the above paragraphs, it flopped in America while becoming a smash hit everywhere else imaginable. By the time they hit the road for their tour for their next album, A Kind of Magic, it behooved the band to simply capitalize on their international popularity and not worry too much about the America that they'd lost. The Miracle and Innuendo are perhaps their most "English" albums; their popularity everywhere outside America had long been cemented. And then Freddie died.