I also think the scene elements took off because of colour photos in magazines and books. Another element is cost. When you add up tracks, scenery, wiring, switches/eletrics it becomes a lot more costly than dying sawdust and making buildings from cardboard. I think scenery layouts appeal because they were more affordable.
The Inglenook and Timesaver layouts did kind of get around the cost issue as small operational layouts. But people do like continuous runs too, for relaxation and breaking in new locos. Chris Ellis in Model Trains International promoted the Inglenook within an oval which is the best of both worlds.