... As I've looked back, I realize it was a dysfunctional company, but I think I could have made a difference, stepped up as CTO (it was offered to me) and driven things forward...
I think all of us who have been in the industry for a decade or two have had an experience similar to this before, especially early on. However, that last part about how they offered up the position of CTO was an interesting footnote. So, how common is it for a developer who has been with the company for only two years to suddenly be offered a C level position? Maybe that's normal for a start-up, but based on the situation as described, it was perhaps just at attempt to keep a warm body behind the wheel as the ship went down rather than an actual commitment to turn things around.
There is an old saying that: "It takes a village to raise a child.". Well, likewise one individual acting alone can't turn things around for an organization, if most everyone else has already given up or for whatever other reason are untractable. In that situation, grabbing the nearest lifebuoy and bailing over the side is in one's personal best interest, as well as being in the best interests of one's family who depend on us to make rational career decisions on their behalf, and it may not matter one way or the other in terms of the outcome for everyone else.
"Do not seek to follow in the footsteps of the wise. Instead, seek what they sought." - Matsuo Basho