Never could figure out why more makers didn't indeed make a more concerted effort to adopt I2S protocol...it just never made too much sense to me. Maybe, to be fair, they knew they were going to drive up costs by including it next to coax on the same component (keeping coax at first would've allowed customers to do the comparison for themselves while preventing total incompatability with other brands). If I recall, the first brand or 2 that tried their gear with it did so without the inclusion of coax...and it didn't take all that long for them to go out of business and I think other makers wanted to take that as a lesson learned. But, I've always wondered had those first companies included coax, despite the expense, that maybe things would've turned out quite differently. Of course it's still not too late to correct such a mistake - anyone could retake the initiative if they would only recognize the need to rethink that 'strateegery thing' a little.
As far as balanced goes, I switched over to it a few years ago and haven't looked back, really. Even though you could say that there are certainly single-ended equipment designs out there that perform better than many comparable balanced ones and all that, it still remains: if you can indeed come up with a great single-ended design, then how much better will it be just by offering it in balanced as well? I'm in total agreement with you, both of these protocols are needlessly neglected by too many makers.
Then again, I suppose what's really put a damper on things concerning I2S as of late is the now impending doom of the physical CD format itself, to be effectively replaced by downloads. I'm betting that the perception (real or imagined) that's out there now is that whatever connection protocol remains will likely be at the mercy of the computer industry instead...even though nothing is really stopping them from adopting it any more than audio makers, I suppose. I can only imagine that what's stopping them from cosidering it may be the real-estate-eating bulkiness of the current connector of choice. But then, what if they updated and reconfigured it and made it a much smaller form factor for the computer industry? But, as it is presently, it's one of those things that looks destined to forever fly under their radar...even Steve Jobs might have missed that one, were he still around. But, to me, without the divine intervention of someone like that ready to champion its cause, then it seems that I2S is one of those good ideas that's unfortunately destined to fade away.
Regards, John