1. Why was this show cancelled? True I've seen other TV shows made after movies not succeed due to plot lines or actors playing the parts but looking back at this one I see a great set of cast and really unsure what the issue was.
2. What was basis behind this show? Meaning was it meant to showcase what happened prior to movie or other.
Poop in his hand ... Poop in his hand
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This is a little late-- I'm sure the OP has moved on and will never see this, but just in case anyone else was wondering:
1.) "Why was this show cancelled? True I've seen other TV shows made after movies not succeed due to plot lines or actors playing the parts but looking back at this one I see a great set of cast and really unsure what the issue was."
Good question. The first episode was actually a surprise hit, setting records for the Fox network when it premiered on a Sunday at 9:30 PM. ...But, it didn't take long for the network to snatch defeat from the jaws of victory...! The second episode aired on the following Sunday at 7:00 PM, and, not surprisingly (since most people are having Sunday dinner around then instead of watching TV), the ratings instantly went from amazing to disappointing. In fairness, the network may have been hoping they'd finally found something with enough of a built-in audience to successfully fill this difficult time-slot, but when the show didn't live up to those expectations, it's like they immediately gave up. As I recall, they never attempted to move "The Outsiders" back into prime-time on any other night to try and recapture any of that initial enthusiasm. Despite its proven potential, they allowed it to just run its course. To make matters worse, executive producer Francis Ford Coppola was in no position to fight for the show's survival in any way, as he was in the middle of bankruptcy proceedings during the show's entire run (at which time he was also filming "Godfather III" as part of an agreement to get himself out of debt!)... So, in many ways, this series couldn't have happened at a worse time.
2.)"What was basis behind this show? Meaning was it meant to showcase what happened prior to movie or other."
The show was a direct sequel to the 1983 movie, even opening with the footage of Matt Dillon as Dallas being gunned down. In fact, the series builds exclusively on the continuity of the original theatrical cut of the film, which means it was never intended as a literal follow-up to the novel (even though S.E. Hinton was involved with the show). Furthermore, the show's continuity is incompatible with the extended DVD re-release of the movie ("The Complete Novel"), as many of the (formerly) deleted scenes from the theatrical film ended up being re-shot and worked into the storyline of the pilot episode. So, once upon a time, the Coppola film and the TV Series, when taken together, represented the entirety of the S.E. Hinton novel plus a whole lot more. Hence, the release of the film's Director's Cut was bittersweet for anyone who ever hoped for a DVD release of this show. Because the updated version of the film is clearly Coppola's "official" version of these events now (and because it could end up being the only version our kids ever become familiar with), the TV series will probably never again see the light of day, simply because too much of the very first episode is now redundant. It can't really claim to be a continuation of the film anymore, since too many of the events are identical-- In some cases, it would be as if the characters are having the exact same conversations all over again, word-for-word, just a few months later. For this reason alone, I highly doubt that Coppola has any plans to ever re-release this show, as it no longer serves as the companion piece to his film that it once did.
That's not to say the show isn't still worth watching, though. If you were ever a fan of the book or the movie, there's a lot to like here. Basically, the focus of the show was on the brothers trying to stay together, on the guys being there for each other during difficult times, and on the social changes happening during the late '60s. The production values don't hold up by today's standards, mainly because series television looks as good as feature films now, but in general, the writing on "The Outsiders" was pretty good. It had its share of cheesy moments, but it also had some genuinely inspired ones. Each character was given a showcase episode where we get to glimpse more into who they are than the novel or the movie ever had time for, even if this does lead to some inconsistencies-- In particular, David Arquette's Two-Bit, even though he looked the most like his film counterpart of any of the show's actors, just didn't seem like quite the same guy that Emilio Estevez portrayed. For example, in one episode where Two-Bit is drinking heavily, Darry expresses surprise that he's acting this way because Two-Bit's supposedly never been a drinker. ...Well, anyone who remembers the movie knows that Darry would've had to take a pretty hard shot to the head in one of those rumbles to ever make a remark like that...! Minor nitpicks like this aside, if you ever get to sit down and watch this entire series, I think you'll find by the time it's over that these versions of the characters will have supplanted any others as being the "definitive" Outsiders in your mind, simply because you'll have spent so much more time with them than in any other medium.