The scientific and therapeutic landscape of Alzheimer's is littered with the data from countless failed trials and compounds, and a big part of the reason why has to do with a lack of understanding of AD pathophysiology. But it is not the only reason. In fact, there are other considerations in the context of Alzheimer's disease that are in some sense precursors to why we have not affirmatively established the disease mechanism.
Foremost is the fact that AD is not the only type of dementia, and that until the advent of relatively recent noninvasive imaging modalities, identifying the afflicted has been largely retrospective (histopathology from autopsy), or based on symptomatology (i.e., clinically identifiable loss of cognitive function). Therefore, by the time patients are suspected of having Alzheimer's, they are either dead or they have progressed to the point where the damage is significant and likely irreversible. This impedes the investigation of a complete picture of the course of disease. Blood and CSF biomarkers are of course too indirect--and it is perhaps for the reason that amyloid levels are measurable that the science has focused so much on the notion that abnormal elevations are a causative agent for AD, and the reason why the drug development industry has chosen to advance compounds targeting the reduction of amyloid.
That said, I don't think that any AD researcher worth their credentials is wedded to the amyloid hypothesis as the only possible explanation for the disease. Most, if not all, are well aware of the complexity of the picture. The real problem in the Alzheimer's space as it pertains to regulatory approval is the lack of meaningful and reliable efficacy measures for assessing the impact of treatment on disease modification. While reduction in amyloid may be used as a surrogate endpoint that could justify accelerated approval, it has yet to be validated as an endpoint for traditional approval--the FDA still considers tests of cognitive function and activities of daily living to be the standard by which efficacy should be measured, because these are things that matter to the patients and their caregivers, and not how much amyloid burden is present. The challenge with such measures of efficacy, however, is that they are largely based on questionnaires and are subject to numerous statistical and interventional biases, as well as high noise.
That said, I am highly skeptical of Biogen's filing, and the original advisory committee meeting earlier this year brought to light some glaring issues with study conduct and the statistical integrity of their submission. This of course has nothing to do with whether I believe amyloid is the correct target, but it says volumes about how (un)reliable are the efficacy claims that were made.
In summary, there are so many problems with developing effective therapies for Alzheimer's: we don't really know what aspect of the disease mechanism we need to target (this is what you have characterized); but we also don't know how to accurately select the patient population (as you'd need to detect them reliably and early enough to be able to prevent rather than repair cognitive decline), and we don't know how best to measure effectiveness in a trial setting. If by some miracle we discover how and why certain individuals develop AD (beyond, say, genetic predisposition such as apolipoprotein-epsilon 4 genotype), and the disease mechanism is well elucidated, then the other issues become much easier to address; but one might as well wish for unicorns because the notion that there is some clear explanation for this insidious disease despite many decades and untold billions of research spent, is just not realistic. AD is much more likely to have a multifactorial and complex etiology, or could even represent a constellation of pathologies, sort of like how "cancer" is an umbrella term for numerous distinct diseases and different causes.