I have personally, and when I say 'personally', I mean personally, witnessed several artists cease to regularly make music because they are no longer financially capable of doing so. Great, talented artists that can't record or tour because they're broke. The little guy is hurting in this music industry climate, no matter what you're told by AP and Spin magazine. There is a lot of great music not being made right now as a direct result of what is going on.
Oh, I have no doubt that this is the case, and yes, it is very sad. However, in my day-to-day music life, I've not noticed a dip in quality of the music being put out, as evidenced by this being my favourite musical year for several years. I appreciate that we're coming at this from 2 very different angles though- me just as a music listener, and you as a musician. If it's any consolation, there are still people out there like myself who recognise that the 'little guy' needs supporting, and do so whenever we can. Money's not just tight for musicians right now, it is tight for consumers too.