Yes it is. It limits how long the train can be, because it can't block traffic downtown, which limits its capacity.
It also limits how fast it can travel. Having its own lanes is better than not, of course, but not as good as being completely physically separated. For an example of this that I'm particularly familiar with, a big part of Caltrain's unreliability comes from it having so many at-grade crossings.
> Zoning laws are changing and have changed to allow infill.
Yes, but very slowly. The current state is that they're extremely bad. Less extremely bad than the US average, probably, but still extremely bad nonetheless.
> There are entire streets where vehicle through traffic has been blocked in favor of bicycles.
Yes, and that's a good move. Would love to see more of those across the city. The way Portland has done it isn't as good as, say, Munich, but it's still a nice thing.
> There are still bike lanes on the major roads a block away too which is why you probably didn't notice the dedicated streets.
Eh, I mean the neighborhood greenways are good, don't get me wrong, but there should still be more off-street paths and physically protected lanes on arterials.
> look at any major street west of 82nd and you will see new apartment buildings on almost every block.
I'm aware of the steady upzoning in Portland, and that's good. It's still true that they're decades away from the kind of urbanism that many cities in, say, Western Europe take for granted as the norm, where "only single family home" areas do not really exist in major cities.