While I agree with most of what you say, including your conclusion that the complete removal of copyright will mean de facto replacement by a patronage system, you miss two crucial points. Firstly, the fundamental difference between the arts in before the 19th century and today is that the distribution costs are now negligible, especially if the distribution is digital, but even if the distribution is physical. It costs less to produce most art in physical form and more importantly to reproduce than ever before in human history, yet prices do not come down. There's also a clear divorce between production costs and retail costs. A new DVD from a block buster movie with a budget in the 100's of millions costs the same or less to buy than the latest top 10 CDs with production budgets in the 10's of millions. Consumers get this, they understand they're being screwed by the CD producers. They're being charged what the CD producers think the market will bear... except clearly the market won't bear it, because piracy is rampant. Music producers (especially) love to harp on about lost sales, but flat out refuse to consider piracy as market indicator. Let's assume there were a full proof way prevent piracy. Sales would stay pretty flat, or I suspect drop a fair bit. People pirate way more than they could ever afford to buy, and if suddenly forced to buy everything, they would pick and choose a lot more, like back in the 80's and early 90's when kids saved their pocket money to buy that one album they'd been eyeing for three months. Concert and performance revenue would probably fall off (except for really big, well publicised, acts, i.e. the guys who are already coining it) because of lack of exposure. CD prices would be forced down. Lack of exposure is why I think CD sales might actually drop in this scenario. The same argument holds for other types of digitally reproducible art.
Secondly, the content-creation (for want of a better term) industry is a lot like the the professional sports industry. We only really here about the super stars, who are 1% of all the attempts at success. The current copyright regime is already in effect a patronage system, except the "rich dudes" are rich corporations who decide who they will promote. Yes consumers can vote with their money, which only constrains who will be promoted to largely popular inoffensive artists, whereas in a true patronage system the individual tastes of the rich dudes funded a wider variety of creative efforts. There are also a lot more "rich dudes" now than ever before. They're called the middle class. They have a fair amount of disposable income. No single person in the middle class has the money to fund an artist in the same way as traditional patronage systems, but there are vastly more potential consumers for art than ever before in human history, and what's more is the skills required to reproduce a performance and the costs involved are way less than before too, allowing artists to either manage distribution themselves, or pay substantially less than previously to someone else to do it for them.
I view piracy as a form of civil disobedience protesting inflated prices. If digital content were reduced to 25% I'm pretty sure sales would more than quadruple. Also, considering the percentages the artists get paid, they're getting screwed the least by piracy. I know that there are plenty of other people involved in music and film production, but for the most part, they all get paid salaries, not royalties. So they're not getting screwed by piracy.
P.S. I'm viewing things from a South African perspective, where minimum wage is approximately $1 an hour and new release DVDs cost about $18 ~ $25, and a new CD will set you back around $20. E-books range widely from $1 to $15, and physical books are minimum of $25 hard cover, $12 paperback. At minimum wage South Africans have to work 2 and a half days to afford a DVD/CD/Ebook/book.