From someone who just went from a Dell UltraSharp 18.1" 1280x1024 LCD monitor to a Samsung SyncMaster 220wm 22" 1680x1050 widescreen (ws) monitor, I definately see what you're getting at. However, I don't quite agree with you completely. You also need to factor in other things too.
1) people don't upgrade just for the widescreen aspect.
For most people, I'd like to think if they're gonna upgrade their 17" LCD monitors, they're not just going to get a 17" ws monitor instead. They're gonna get something bigger AND in ws, like a 20" ws monitor.
Case in point, with me, I set my old Dell UltraSharp on 1024x768 (one setting below the monitor's native and max res) since that makes things easier for me to view while lounging back in my chair. I set my new Samsung SyncMaster to 1280x1024. I'm still getting more vertical viewing area while having excellent sized images that I don't need to squint at even while wearing glasses.
To note, ideally, I'd like to set my new ws monitor to 1440x900 to get the best tradeoff of lots of pixels and easier to see images, withOUT having the black bars all around the viewable image area, but that's another topic (esp. for ATI tech supp)
2) people like having 2 windows side by side for comparisons.
Whether if it's spreadsheets, documents, images, code, contracts, or whatever, it's easier to do that on 16:9 ws monitor than the std 4:3 aspect ratio. For the latter, the monitor would have to be bigger to compete with the ws
3) Many PC games support ws
What one poster said about humans seeing more range in side-to-side than up-and-down is true. I believe that's at least one of the reasons the motion picture industry uses the 16:9 aspect ratio. You get the maximum amount of picture that most people can handle at once without it being too much.
I KNOW that's the reason Nintendo made their handheld gaming system, the GameBoy Advance (GBA) widescreen (it was mentioned in the first issue of Nintendo Power Advance, Nintendo Power's 'specialty magzine issues' dedicated to the then brand new GBA handheld). If you recall, the previous gameboys (Gameboy, Gameboy Color) were practically square screens (160x144 on 2.6" size). By contrast, the GBA is 240x160 on a 2.9" screen. I thoroughly enjoyed the orig GB and also enjoyed the GBA, but I'd say among other things, Nin definately did themselves good by making the GBA widescreen b/c the GBA is the top selling gaming handheld behind its orig GB line. PSP also followed suit with its 4.3" widescreen at 480x272 pixels.
Console gaming may have eaten away at some of the supporters for PC gaming, but there's still a sizeable # of PC gaming players out there. I'm talking about those who play games like Call Of Duty, Doom3, other first person shooters, various sports games, and RPGs. Not those who play online flash games like Bejeweled. Those that do more "hard core" PC games get the maximum effect from ws monitors
4) Some LCD monitors let you pivot the screen
Reach out to turn the monitor 90 degrees, change a setting in your video card, and now you've got ALOT of vertical viewing area, just like a book. While you can do this with certain non-ws monitors as well, being able to pivot at ws monitor gives you an ideal viewing experience for long winded documents and articles
If you're interested in this feature, note that the monitor will likely have to have a stand of higher height to allow clearance for it to pivot like you see in here
5) even if you square-ish screens do have noticeable advantages, by design (dunno if it's really cheaper for manuf to produce ws over non-ws) or by what the manfuacturs produce (to keep up for the consumers overall preferance for ws), ws appear to be cheaper than their square-ish counterparts
Those points being said, I still have my old LCD standing by. It's collecting dust, but at a moment's notice, it can be dusted off and swapped back. However, assuming the black bars at 1440x900 resolution doesn't get fixed, at the very least, I'll keep the res at 1280x1024 and change it to 1680x1050 when I need a HUGE area.
To be honest tho, a larger 4:3 LCD monitor was on my radar. I got my new monitor only b/c it was only $200 at a huge sale, so for me, price was more of an issues. Of my points above, #1, #2, and #5 are what made my ws purchase most desirable. I've alr gone into detail for #1. #2 isn't required for any work related activity, but it is nice but not necessary to have. #5 came up when a big sale occurred. #3 I get with a freeware board game thjat's nice to have all those pixels, and widescreen helps for some setups, but for "real" PC games, it would've have been fully worth it since I'd probably wanna upgrade my vid card first.
If you're still into the 4:3, consider getting a 22" monitor at 1600x1200 resoltuion or someth like that. Be forewarned tho, my quick searches return those at $500+. Others on the otherhand will FLAT OUT REFUSE to use a square screen, some of it directed at handhelds, while others at computers. The choice is yours.