It's all about how you train it. That makes a much bigger difference than the art itself.
"The art is irrellevent" is, I think, one of the biggest myths propigate in martial arts (like the "size doens't matter", and "register hands as deadly weaopns" myths). Of course the art matters.
Of course, the art is part of "how you train". I would be impressed to see a person training by regular limited-rules sparring against people of various arts who was still doing something which resembeled the TKD cirricculum.
I hear stories of martial artists who have switched to different martial arts because they got whupped and their previous art was TKD. It's really bothering me and kind of losing my faith not only in TKD but also in the martial arts
There are a couple of different factors involved here. Despite my comment above, there most certainly is the problem of training emphasis, but from the instructor and by the student.
But let me start by discussing TKD as a fighting art. I took up martial arts originally becuase going to a gym was boring. For a variety of reasons, TKD was my first art. The cirriculum for TKD (WTF/ITF/ATF) simply isn't focused on fighting. The focus on kicks, the poor handwork, the complete lack of grappling skills, the essentially non-existant weapon skills, the use of flashy but low-percentage techniques (takes a long time to move a foot 9 feet), the tendancy towards point sparring, in armor, without footgear, etc.
TKD makes some amazing gymnasts, and certainly can be used effectively combatively; but the attempt to make a true fighting art out of it is more of an after-thought than anything else.
Because of all of these factors (poor choice of technique, lack of experience in limited-rules fighting, lack of experience fighting people of other styles), TKD practitioners do not tend to fair well against similarly skilled members of many other arts.