I won't even mention the "origin" of pwned here. (I
mean, who the fuck cares... "O" is next to "P" on a keyboard. It was going to happen eventually). Unlike
silly misspellings like teh, the reason why "pwned" became
popular, is because it looks and sounds
good.
If you look at the phonetics of the original, owned, it has a very round, relaxed
sound to it. The sharper "pwned", however, is fast and furious, like the cracking of a
whip, the firing of a silenced
gun, or a motherfucking laser weapon.
PEW! PEW! ... pwned.
Because of it's explosive sound, "pwned" will mainly be used where someone is defeated or humiliated in a very sudden and convincing manner. The slower, more elaborate "owned" will more oftenly describe domination over time.
"pwned" is a very good word. It's phonetic similarity to fast, impressive finishes seems well suited to videogames. Because the word sounds like what it does, it will probably stay with us for a long time.