This is akin to asking whether too many musicians and musical genres are harming the hobby of listening to music. As for whether I agree with the opinion that live music isn't about the music but all about the show being put on by the artist, I'll politely disagree on that.
1. I welcome the fact that there is a plethora of choices in the "hi-fi" market that allow people to get into the hobby these days without a huge investment and possibly buyer's remorse. Sure we can denigrate someone for listening to music on a sound-bar but I'm not going to denigrate someone for listening to music on a pair of wireless speakers. If that floats their boat...great. Allowing people to upgrade as they get into the hobby is what it's all about. I recall going on group rides, and there was always one Dr/Lawyer/Dentist in the group that would belittle someone showing up with the "improper" cycling kit or an old steel bike and not take them seriously because said "serious cyclist" was riding a top of the line carbon fiber Pinerallo or Colnago w/ Campy Super Record.
2. I enjoy listening to music and have various ways to do it with my mid-fi system I've upgraded over the last few years. I do enjoy exposing friends and family to what music can sound like on a decent, not expensive setup compared to their Google Home/Sonos speakers. But many aren't hard-core music listeners to begin with. I have a handful of friends who actively collect records, and their set-ups are modest at best. None have a high-end dedicated streamer or DAC, let alone a CD player.
3. The decline of hi-fi stores has been happening over decades so it's not a sudden thing, and honestly, I don't have the time or energy to drive across state or out of state to demo gear. What we have now is a "hi-fi" ecosystem that people can get into with nominal effort and work their way up and search the world wide interwebs for manufacturers they've never heard of or wouldn't have normal access to where they live. If anything, I'd say the plethora of choices actually encourages people to really start dedicating time to listening to music as a serious hobby and not audible wallpaper.