I can't see the possibility of it ever having become an outright bomb, as they hyped it enough at SF cons from 1976 onward to practically guarantee that crowd would show up opening day. IIRC, Lucas intended "Splinter of the Mind's Eye" to be the sequel if Star Wars was moderately successful. It would be interesting if the script version of that ever showed up.
I can't see George doing skin flicks, but maybe he would have directed American Graffitti II personally or gone up the river to help his pal Francis out with that war movie of his.