You're kind of right, but also think of the art itself. Do you hear anything meaningful in mainstream hip-hop nowadays, let alone a decent flow, solid (non-cheesy) rhymes, and actual skill at rapping? I wouldn't complain about it if the style was different and the rappers were actually good, but now people are just using it for their paychecks and 15 minutes of fame.
Well, I'm glad you kind of understand, but I say again, this time perhaps more bluntly.
Less motivation for quality through competition leads to less competition leads to lower quality. Not to say that there aren't those out there doing it as a labor of love. I'm sure there are, but it can very hard to see the stars at night through all that light pollution.