The modeling hobby is alive and well. Those who really want to build and fly WILL find a place to fly. They will either revise the scale of what they build to fit the readilly available flying sites... or they will drive the distance required to get to a site appropriate for the model.

The micro RC arena has finally become viable with planes under 8 oz having 4 channel operation being possible without having a degree in EE to design your own RC system. You hear of more and more people gaining permission to fly these in HS gyms. The micro RC stuff is small enough now that a common 2 car garage is becomming a viable flying site. (along with some large living rooms...)

There are more 30% and larger scale models being flown than ever before. The 30% to 45% ARF models were essentially unheard of just a few years ago. Now they are starting to show up at the smaller club flying sites. You either built the large model yourself or hired a professional builder to get this size aircraft 10 years ago.

The hobby is headed in 2 directions... very large and very small.
AND the ever popular .40 to .60 size stuff is still going strong.