Have you continued link building work on the current domain ever since you 301'ed it? It's really a tricky situation. It could be due to old links on the original domain (especially after penguin in may and the monthly pandas)
If you are sure that the technical issues are the main cause for your drops, then you better move it. Magento is actually pretty seo friendly and since you have a dev, then it's even easier. I would not recommend wordpress for big ecommerce sites so it will depend on your site's size.
