Comparing flat UI design to Swiss design from the 50s is missing the obvious difference that minimal Swiss design was about presenting information, not creating an interactive interface.Yes – they're different. Obviously so – there's 60 years between here and there. The point is to compare the minimalist approach, and point out that there is precedent for it. There is no absolute, guaranteed, 100% 'ideal' user interface, and it's something that we are still working on – iterating on design is how we do that.
it becomes harder to separate interactive elements from non interactive ones and harder to tell "on" from "off" (I STILL can't tell if iOS's shift is on by looking at it). The desire to present information in a modern/minimalist way is at odds with this.
The iOS shift key is a good example of where this had failed (and I do hope it is fixed). But here's an alternative take – presenting information in a minimal fashion can help to draw attention to interactivity, rather than distract from it, thanks to the elimination of visual noise. The point is, it's far from clear what the best approach is.
My personal opinion is that what you call "wider design context" is pure fashion. Yes, flat is fashionable, but it's just not as good at the job of communicating the nature of UI elements to the user.
I don't think that's a case, or that such design can be called a 'fad'. Design is still an evolving field – devices and the way we use them is changing, and design is no different. I won't deny that there's an element of fashion, in the sense that the popularity of design styles can influence other designers. But isn't that equally explainable as a desire to avoid completely 'off the wall' interfaces that will be unfamiliar to users?
FWIW, I don't find flat interfaces to be an issue. Metro, for example, was simple and elegant, while allowing for useful approaches to clearly displaying and exploring information. And the iOS approach, though it has inconsistencies, actually makes a lot of sense, with the 'content is king' and 'depth through translucency' approaches. Most of the problems with the latter appear to be to do with the expression of state.