It had something to do with lax immigration standards. These guys were allowed to take flight training at schools in Florida. You need visas for that kind of thing. They got their visas, some of them, issued posthumously by our illustrious INS.
These guys entered under one visa, then applied for a change of status. All within reasonable standards for the system. People sometimes change their mind, or situations arise that requires a change on plans. The INS provides for procedures to address such things, and these people used those procedures to their advantage.
Is that indicative of a broken system? Not so much as it is indicative of this country's heritage of freedom.
It was much simpler and less likely to attract unwanted scrutiny for the terrorists to exist within our laws, and guarantee themselves the ability to go about their deed, than to risk the possibility of detention by the INS.
The pure fact of the matter is that the INS had no reasong to think that these guys were any more dangerous than any other foreign visitor to the US prior to 9/11.