Is the core profile module dead?

I came to a cross roads when I began working on a site and needed the users profile to be rich with juicy content. When I actually had a look at how much Drupal's profile module could do out of the box, I was sadly let down. After doing some research and listening to the 'Deprecated' Lullabot podcast; here are some conclusions I have come to (please let me know if you disagree):

So using the current version 5 core profile module can't be a good idea for generating a rich personalised experience. What is the system if you want to create anything like the big shot 'You Tubes' and 'MySpaces', it seems the alternative to the profile module at the moment is to use the nodeprofile and nodefamily modules. When these modules are used together, a profile can supposedly now become a node (basically a fully fledged content type which can be edited using all the rich, juicy CCK modules). The big minus for me seems that if your solely having profiles be nodes it doesn't yet support a lot of the registry functions (I don't think) and you'll loose a lot of the really nice logged in/logged off features you'd get normally.
So the way I see it best working will be to keep user accounts, but have them almost hidden from the top layer of the visible site. Then make a one time content type called 'profile' using the nodeprofile module. Users when they sign up are immediately directed to create a 'profile' content type and as a pose to just personal infomation and text fields, they can now include all the same rich media fields as any other node could have.

Please let me know if this little article makes sense, and any feedback is welcome. I'd like to be really confident that generating a node based profile system for a potentially large community site will be the best way to go. At the moment I'm 90% sure.