Interesting read, although I'm a little less disheartened than you are I believe. I think this post has a lot in common with the "do you still make ReMixes" thread of a while back, since it touches upon why you are an artist, and what you expect to get out of it. If you truly want a personal connection with your audience, then I understand the online world can be a little disheartening. I find that the best connections with the audience come from live shows. But, other personal connections I get is with peers, and that is MUCH easier online. Working together with others, getting feedback from judges at OCR, discussing exactly the things we are discussing now - those are valuable things only made possible through the possibilities of an online community and social media.
Yes, social media (and/or internet 2.0/3.0) can bring out the worst in people and there is indeed so much content that it makes it hard to stand out. But I have YouTube videos, music, art and more that I frequently enjoy and keep coming back to and I am certainly not alone. Yes, it makes it hard for us to be noticed when there are so many others out there, but without it we wouldn't be noticed at all. I wouldn't be able to be an artist and to do the things I do without these technological developments. Furthermore, I think that we now live in a period where apps and social media rise just to get that personal connection with an artist as long as you are also an artist "offline". Especially here in the Netherlands (where you're also based I see) there are more and more initiatives to be able to meet personally with artists, see niche performances or art and to connect on a deeper level. So while I really recognize and understand the dark side of it all (and we've all had bad experiences), I also think it gives us possibilities that we didn't have before. It's up to us to determine why we do what we do and what we want to get out of it, and then decide on the ideal platform to pursue that. Because just randomly dropping something online (facebook/youtube/wherever) will indeed lead to just a consumerist connection. At least that's what I think of the issues you described
P.S. I also have high regards for the "commercial" artists that are perhaps not always the best in their musical skills, but as entrepreneurs and business(wo)men, they have a lot of skills to be able to get where they are. If building a company or a brand is your passion, and you can combine that successfully with an art form, it takes a lot of determination and skills to be able to achieve success and I really respect that.