UG! Too much to respond to!
First, the easy one:
Can I ask an unrelated question? EUOL, why do you capitalize all book titles instead of italicize them? Is that another one of those weird underline-instead-of-italicize things?
That's exactly it. All caps is the default for a medium that can't italicize or underline, and was often used in the days of typewriters. Right now, people use it mostly in emails. (Though that's also the way it was represented in my contracts, incidentally.) I use it here partially because I'm lazy, and partially because I'm used to it now.
Okay, now for EP's interesting debate. (I'll expand on my theories in a bit for you, SE.) First, let's establish that change is needed. Let's use this quote as a starting point.
Eh, no I don't foresee fantasy stories moving away from quests and antiheroes. Do you really think horror, romance, or mainstream have fewer similarities in their genres?
It's hard to compare fantasy against 'mainstream,' for reasons you have already pointed out. Let's compare it to something closer to home, instead. How does fantasy compare to science fiction?
I put forth the supposition that SF is FAR more diverse than fantasy. It has numerous sub-genres--from cyberpunk, to military SF, to exploration themes. It is virtually limitless in the topics it deals with. It has many very rich settings, and it's hard to pin down exactly what the 'stereotypical' SF story is. That is because the genre is so diverse.
Fantasy could be like this, but it isn't yet. Right now, it is dominated by a single sub-genre--the Tolkieneque quest epic. Its settings are rather bland for a genre that could, theoretically, encompass everything. Yes, the magic systems get original, but how many books out there get away from the stereotypical 'medieval Europe fantasy?' How many include interesting races that aren't just Tad-Williams-style reworkings of Tolkien races?
This is what I think needs to change. Actually, I see the magic systems getting very repetitive too. How many 'telepathy' style or 'elemental' style magic systems are there now? RUNELORDS and ASSASSIN'S APPRENTICE are both good examples.
This is, I think, what holds fantasy back--and what makes it less mature of a genre than SF. I still like reading fantasy, but I think it has growing to do. Or, perhaps, the audience has some growing to do. Either way, I think the genre is capable of far more--it isn't stuck like other 'genres' are. Westerns and Romances are very different from SF/F in my mind. The previous two are very limited in what they can do, while the latter two are rather unlimited. That's why I think 'genre' is even too narrow a definition for them.
(My response to SE in the following post.)