Guys, it's not that bleak!
There are a lot of other hobbies in worse shape than ours. We recently had to close out my parents house. My Mom was into Ceramics. I can't begine to tell you how much trouble we had just giving away all her stuff! 2 kilns, 78 molds, paints, brushes, glazes, tools and other paraphenalia associated with the hobby. Sr. Centers, schools, adult day care places,,,,,,NONE of them wanted any of it even as a donation! Even Ebay was of NO help! Thank goodness Mom's dementia has progressed to a point where she hardly remembers having any of it. The only thing left is a bunch of greenware (unfired pieces) that my sons are going to use as targets for thier pellet guns!
If you want to lament a dying hobby,,, theres one for ya!
As far as the hobbies current health, true, prices are on the increase. But so is everything else including the price of crude oil. The same crude that a lot of the plastics we use today come from. The manufacturers are not making a killing on this stuff by any means.
So why are they making special items, limited runs and just about every variant of the F-unit that ever existed? Cuz
YOU all asked for it. Maybe not you personally by name, but as a hobby group, yup, we did it.

Simple economics, supply and demand, follow what the market wants and they will beat a path to your door. All the lamenting about the evils of RTR is our own fault. IF we would have left the BB kits alone and didn't superdetail them, then maybe they wouldn't have seen the demand for detailed cars, ready right from the box.
So what do we do about it? Blame this manufacturer or that? Blame the Chinese or the oil companies? Whine about the demise of the 2 dollar freight car kit, which was crude by todays standards.In 1960 was only 2 bucks, gas was .28 a gallon. Today, that same gallon cost @2.53 (what I paid today per gal) so that 2 dollar car should cost you (round numbers) 9 times as much as it did in 1960 = $18.00 for a blue box flatcar. Would you pay that today??? I don't think so. Pick your time period. I got my license in 1977, gas was .58 pr gal, the bluebox kits were about 4 bucks then. It all works the same.
DC vs DCC. I hate to tell the DCC bashers out there, but if you want to give todays kid half a chance at being a model railroader, don't bore them. They will be playing a Nintendo DS before your can explain a myriad of block switches to them. Give em bells and whistles in an easy format, and you might stand half a chance with them. From the age of 7, my youngest has been showing me tricks with my DCC that I didn't know about. It was at about that age that he taught me how to Tivo.
Our best chance to save the hobby? Expose kids to it. Talk to them and find what they like about it, then focus on that with them. When were doing a public club show, we will occasionally stop the "scale trains" and break out Thomas and friends. Not only do all the kids immediately pay attention, but so do the parents.
It's not that bad. We just need to be steadfast stewards of the hobby, and learn that it is going to have its ups and downs. The market will take care of overpriced items for the most part. Supplier issues will come and go. But this attitude of "the sky is falling" is nothing more than equine excrement and if unchecked, will sink us all.