Sly n Smiley- I went through the same experience and have formed exactly the same opinions although I have been fortunate enough to now have an airline job again. My application folder was as thick the second time around as it was 14 years ago! If my kids want to go into aviation for a career I will strongly suggest they get a qualification that is recognised outside of aviation. I would only recommend aviation as a career to those who are really passionate about flying.
I did note that in my second stint as an instructor there were few school age kids learning to fly whereas 14 years ago there were more. If the predictions for 20,000 pilots in the Pacific Basin by 2020 are true then flying jobs will be easier to get but in the mean time I think there will be a lot of people leaving the industry.