Great topic BMus! And very interesting responses too.
I don't think people need worry. The music will take care of itself. It is constantly evolving and more and more is made every day. Some guys would like to see the return of "Steely Dan" or "Dark Side of the Moon" recordings but I think not many people are interested in that sort of stuff now. People still can listen/reminisce to that sort of thing on their old recordings and curse the brickwall limiter and whatnot of todays music but the world has moved on. Also, the man on the street doesn't give a damn about the loudness wars whatsoever!
About monetizing music. Again, it will take care of itself. There are more acts than ever before so they won't all make it. There is a lot of crap and not only are their records competing against todays acts but against the acts of years gone by. But.... there is always room at the top as Daniel Webster said about the legal profession. The guys on the fringe will struggle as the fringe recedes! Elton John and the guy who invented "Cats!" will still be doing alright.
And those below the fringe artists will still be supported by the general public. Not only through their substandard record sales and poorly paid live gigs and busking sessions but through the unemployment benefit.
I am blown away by the number of terrific bands I have been exposed to because of the interebnt the last few years. It's a GREAT time for new music.