Some musicians -- David (B.), Larry, and Bill (B.), at least, will know who I'm talking about -- insist that a performance is a conversation, while a recording of a performance is like reading a one-sentence excerpt from only one side of that conversation. I'm not sure I can fully embrace that extreme of an interpretation, but I'm sympathetic to the viewpoint to the extent that a live performance and a recording of a live performance are absolutely not the same experiences, for either the audience or the performer. I think non-live recordings can inhabit a different realm, and I'm not sure I see anything fundamentally less musical about the layering and editing possibilities provided by the form. That said, my personal preference, both as a listener and as a (now hobbyist) musician, rests with the passion and uncertainty of performance. To me it's more exciting, and more emotional, and more personal (even when it's done with a group, and especially when it's done with an audience).
I can read scores, and at one brief time of my life was able to conduct from them, but I'm similarly unsure I can embrace the assertion that one must be able to read them to understand the music produced from them. That seems to be a way to understand composition, but without the interpretation there's not much to listen to. I suppose it also helps that my preferred musical genres generally operate not only without scores, but in fact at the other end of the interpretative spectrum. I do think that following the score at a live performance (physically or, I suppose, from memory) fundamentally distorts the performance for the score-follower, and that includes the conductor.
But to address your initial post, Tom, I don't think that the forces that could render performed music obsolete or unknown are related to the recording of it, or to people who's entire understanding of music is via its recording. On the latter point, at least, most of those people are listening to music that has to exist as a recording because of its essentially synthetic nature (and that will be true even when it is "performed" "live"), so the format in which they receive it makes very little difference. That said, I don't know any better than anyone else where the money to support performing artists' performances (of any genre, though obviously the non-popular are most at risk) is going to come from once we've finished demolishing the old structures, and that's true whether the artist in question is Leon Fleisher or some young kid in his bedroom who wants to be Jimmy Page.