What were the primary reasons for the cancellation of the Woodstock 50th anniversary event in 2019? Did the trauma from the infamous 1999 event have anything to do with it?

The primary reason seems to be that the maximum crowd capacity was hotly disputed among the various authorities that were required to approve the event.

Dentsu Aegis ceased its involvement after the organizers reduced the capacity of the festival grounds from 100,000 people to 75,000

Superfly, a production partner [...], pulled out of the festival [...] also citing changes to the festival's capacity as a reason for its withdrawal.

https://en.wikipedia.org/wiki/Woodstock_50#First_cancellation_and_change_of_investors

In my --'OPINION'-- it is highly possible that the problems caused by overcrowding at the original event (whether or not they were 'traumatic') may have made financial investors and local authorities a little skittish and overcautious; even though the original event is still mostly remembered for its aspects of peace and love.

Note: the "original" event was the 1969 festival, the "traumatic" events I am referring to happened in 1999 during an event for the 30th anniversary

Woodstock 50 was meant to celebrate the iconic 1969 festival, but it fizzled out due to poor planning, financial struggles, and lost venues. Organisers faced major hurdles-permits fell through, key artists backed out, and the original investor pulled funding. They scrambled to relocate the event multiple times, but it never gained solid ground.

While the disasters of Woodstock '99 weren't directly to blame, they definitely cast a long shadow. The chaos and violence from that year soured public trust and made investors and venues wary of a repeat, especially as the 2019 plans started falling apart.

https://time.com/5639078/woodstock-50-explained/