The majority of gamers did not use it. I remember that transition, and the numerous compatibility issues that games specifically had on Win2K, since that was exactly the kind of software that was the most likely to play fast and loose with memory protection etc (also, nascent DRM in form of CD copy protection). I personally ran Win2K for several months before reverting for this reason, and so did most of my gamer friends.
I do recall the win2k-specific compatibility issues with games. However, everyone I knew was still using it. In reality I think it might have become more popular just before XP, as compatibility issues were worked out. XP adoption was very slow though.
This might be some kind of regional difference. I remember that WinXP adoption by people who were already on Win2K was blazing fast for the consumer market (colleges and businesses were a different story). But most consumers went straight Win98->XP, or in some cases 98->ME->XP.
