I think we might agree with each other, but you are being more clear than I was. If we are looking at the web as the miraculous document-exchanging network that it was, yes, Javascript is may be literally ruining everything. If you can render something once, absolutely do it once, what a huge waste.
I was more disagreeing with the concluding assertion that "with modern tools, there's no reason that anything — even a highly interactive app — couldn't be prerendered on the server." There's no reason it couldn't be, sure, but it's way harder when the clients are just as capable -- and, once things start getting busy, probably even more capable.
For one reason, because that one computer can usually do it (or at least most of it) once, and instead you're forcing millions of people to redo the same computation themselves. That's just... wrong.
> But if I'm building the next great web-based spreadsheets application (...) Why WOULDN'T I pick that option?
Well, in this case this is the right way, because you need to dynamically interact with data entered by the user (in this case, people usually make another error - they send data to server that there is no need for; but that's another topic. [0]). You're writing a web application. But a web site, like landing pages, blogs with articles, etc. have exactly zero reasonable needs for rendering everything client-side. It's just making the same compute millions of times because someone was too lazy to compute it once.
[0] - actually, it's not. One could notice that most of the problems with current web come from two things: sending the code that should stay on the server to the client, and sending data that should stay with the client to a server.