How exactly did Venezuela's economy fail?
I think you summarized most of it quite well. Few things that you missed: 

There was a host of bad macro and microeconomic policies. For example, nationalization of many firms, price controls, subsidizing many uneconomical activities etc. Also actually the investments into oil industry and productivity declined in Venezuela after the industry got nationalized so that part was not fully correct, and Hugo Chavez was appointing people who were making it worse (see  thisforeign policy article).

Also when it comes to social policies, it’s definitely possible and legitimate to want to have Ralwsian welfare state - this is matter of philosophy and value judgements not economics. However, this does not mean that a country can just arbitrarily sets its social policies and ignore resource constraints. Venezuela was running large fiscal deficits even in their best times when oil prices were high save for few years with surpluses.

Moreover, one thing that many states that are running out of money resort to is printing more of them which causes inflation. Now moderate inflation is fine but if you are running large deficits that you can’t really hope to repay with future economic output you need to start printing so much that it will eventually lead to very large inflation which will in turn only accelerate collapse. Once money is worthless people start resorting to barter which is less efficient and just exacerbates the problems further.