I agree with your points about object-making, Libby. Maybe the lack of object-making in installation art is its problem. Installation art is about space-making and not about object-making.
And space-making is not something sculpture does well –with the exception of works that are architectural (I would put Richard Serra, James Turrell and Mariko Mori [and her “Wave UFO”] in this category with Gehry, Calatrava etal). 
I like that you bring up the world of painting, but I think paintings are objects, too, and they don’t have such an easy time of it. Paintings are windows and they have to compete on that level. If it’s a bad window, it’s a bad window. [image is NASA computer graphic of “lift off” accompanying a discussion about launch windows.
