I believe there's a fine line between all the "types" of RPGs anyway. And in that fine line, lies the problem we seem to discuss. You guys just described certain styles to the RPG, linear, dialogue driven, open, etc. First, all games are essentially RPG simply because a player is taking on the Role of an avatar, a human one or otherwise. Second, each of the styles described above is probably attributed to a specific game, meaning, game designers don't metastasize any styles in between. Tiredinnuendo mentioned Dues Ex and Mass Effect as hybrids, but even then, most any decision a player makes had to go through a dialogue sequence first. I think, in a way, those dialogues are trying to mimic how fast a brain works when developing a strategy and then manifesting it. Unfortunately, in games, that has to be slowed down to fit a game play style - and many times it is slowed way down and becomes uninteresting like Never Winter Nights or Oblivion. These games are fun for a while, but the dialogue is just too overbearing and boring for the majority. So, as in Mass Effect, one can't just think of how they want their comrades to move through a battle so it takes some menus and button selections.
My real point is, though, everything is an RPG, and what the real challenge is to game designers, is placing the styles in places that fit within the "right" moments in games. Right now, it's easier to make an entire game linear or make one entirely dialogue based. So, that's what we get. I don't think RPGs are bust at all. It's more foundational than that - game makers just aren't as creative as we give them credit for. Or at least not as often
