>People probably read more books. There were fewer other demands on attention, whether YouTube, social media, online content generally, etc. I certainly read books far less than I used to.
I'd imagine the number of books sold per year is strictly increasing.
If it's increasing because of a growing number of readers, then that's a winner take all scenario where Harry Potter sells more and more copies as each new reader hasn't read it yet.
If it's growing because of one extremely voracious reader buying up every book they can get their hands on, that's a scenario that favours more obscure authors.
Closer to the later for most authors. Though every few dozen years there is another Harry Potter that everyone in the world buys and reads. For most you need to target those voracious readers and what they are willing to pay for - but be ever on the lookout as to how you can jump to the Harry Potter world where everyone buys your books.
Harry Potter was good (in the first few anyway), but if you like that type of thing there are ton of much better books that never made it.
If you particularly wanted books that "didn't make it", I don't know anything about that. But maybe you just wanted books that are like HP but better than HP.
I read the first few HP, and thought they were dreadful, and thus never read the later ones, so maybe I'm not the person you want advice from, but here are some recommendations of novels/novelists in the same genre (fantasy novels, written for children, that hold up for adults):
Nearly anything by Dianna Wynne Jones, but I particularly enjoyed The Lives of Christopher Chant, Archer's Goon, and of course Howl's Moving Castle.
Susan Cooper's famous Dark is Rising series. Half the series is more normal-kid (starting with Greenwitch), half is more special-magic-kid (starting with The Dark is Rising).
Garth Nix's Old Kingdom, starting with Sabriel.
While China Mieville is very much not a children's author (really! don't buy a random mieville book for your young niece/nephew, really don't!), Un-Lun-Dun is an amazing book in this genre.
This suggests otherwise. (Although this is obviously not a complete set of data. I'd actually probably have expected a bigger falloff but maybe ease of acquisition leads to more people buying books they don't end up reading.)
I'd imagine the number of books sold per year is strictly increasing.