Demos like Area 5150 are about pushing the hardware beyond what people thought was possible. If you were to show it to one of the 5150 engineers back in the day, they would probably struggle to explain how it was done.

There is definitely a place for the types of demos that you are talking about. Some of them are being made, though the introduction of artificial constraints is common (e.g. the size is limited to 64 kB or 4 kB). There is even value in creating the best demo you can, even if it doesn't impress the demoscene, simply because showing what you can do will likely exhibit skills beyond those of a run-of-the-mill developer.