The below-par performance came on the back of an encouraging display in the defeat to France on the opening weekend.
Ireland are next up for the Scots and Telfer admits only Sean Lamont, Kelly Brown and John Barclay can look at their performances with any pride.
"Serious questions must be asked about the mental toughness of some of our players," said Telfer who coached Scotland to their last championship victory 12 years ago.
"If they thought that they just had to turn up and assume that the result they achieved against the Springboks (Scotland's last Murrayfield match, in which they beat the world champions) would automatically follow, then they were given a very rude awakening by a Welsh side hurting from criticism at home but still containing some world-class players.
"And it was those players - Shane Williams, Jamie Roberts, Ryan Jones and James Hook in particular - who led by example.
"Only Sean Lamont, Kelly Brown and, to lesser extent, John Barclay compared favourably with their opposite numbers.
"Andy Robinson was honest enough to admit that the team had taken a couple of steps backwards in development, and it may be a blessing that he and his coaches have a fortnight to assess the situation and try to get the show back on the road.
"They did it after the All Blacks horror show in November and, hopefully, they can do it again for the Irish game."