[Villager Dude]

The Transponder thru a Unique code transmits data to the Controller and shows up on their Radar Screen. It reports back the altitude, direction, and speed.

My opinion is :

The Pilot or someone else turned it off .

If they lost oxygen and the pilots were incapacitated the plane could not continue to fly and lose altitude. If the auto pilot was engaged then the plane could continue to fly but not change altitude or direction to where it is reported to be heading. Pilots are required to have alternate oxygen masks on in case a loss of oxygen occurs.

There is a code , 7500, that a pilot can put into the transponder to alert the controllers that the plane has been high jacked. There are codes for loss of communications also.

Radar can track an object in the sky but just knows the location and not altitude, etc.

My theory is the plane was headed somewhere and reduced the altitude because it would be harder to detect on radar. If they did not make it to their destination then perhaps a fight took place and the plane became unstable.