I started reading this thread just today, and after one hour I decided to skip to the end early to post the thoughts that I have been having.
As a caveat, I am a kit builder but I have owned several ARF models. Now, at the risk of sounding sappy, I do hope to see a return of kit building for a few reasons. First, there is nothing like the look of pride on the face of a pilot who just finished his newest kit and is showing it off. That speaks deeply in my opinion of the inherent need of humans to build. The second reason is that I think that building kits has the effect of building friendships, somehow sharing that experience leaves a mark. And third is the knowlege gained in the construction process. One reason that I think ARFs do not last as long as kits is the lack of knowledge of how the thing went together needed to put it back together after an unscheduled meeting with a solid object

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I know the intent of this thread was not to debate the relative benefits of ARF versus kit, so here is my observation on the subject. I was in a LHS today, and noticed this very issue. There are rows of ARFs, maybe 100 planes in total; there were only 5 kits

As they say, variety is the spice of life.
The only way that I see kits making a comeback is through the efforts of kit builders by attempting to engage new ARF pilots as they enter the hobby in the joy of building, and by getting younger generations involved in kit building. What better way to get the kids off the couch and away from the TV than by having them build a plane?
In the end, human nature is what it is and some people will never display any desire to build, while others will never display any desire to buy an ARF. Both are perfectly acceptable situations so long as the atmosphere continues to support our efforts to beat it into submission!
I enjoyed all of your posts, thanks for sharing your thoughts.