I agree the system has some major flaws. It is better than the alternative system with the RIAA prosecuting people for 10,000$ per song in my opinion. I don't want my money going to poor 'artists' that are just manufactured entities by massive labels. Luckily the recent rulings do not support a levy on digital music players or digital storage devices.
Your proposed problem to focus on solving would drastically improve the American system if changed, so I hope it happens.
One final point I would like to add: I did not purchase music in university when I could not afford the luxury. Since I have improved my economic situation, I have recently purchased various older albums. I think that is a good example of how the system can potentially be successful.
Ask 10 people whether they'd rather give $1 to Clay Aiken or see a single mom sued for $2,500 for illicitly distributing a Coldplay album. You're right; they'll all fork over the $1. But they'll all have to think about it for a second.
Your proposed problem to focus on solving would drastically improve the American system if changed, so I hope it happens.
One final point I would like to add: I did not purchase music in university when I could not afford the luxury. Since I have improved my economic situation, I have recently purchased various older albums. I think that is a good example of how the system can potentially be successful.