Hm, I don't believe it's a technical problem, although it's a recurrent theme among techies. PGP is hard to explain to someone who didn't spend the time to digest certain concepts but installing GPGTools on your mac, generating a key and using it is not hard, nor complicated... You can even store the passphrase in the keychain.
I believe that most people using email don't feel there's any added value in using GPG, that's all. This might change in the future, but we're not there yet.
Couldn't Google, Microsoft, Yahoo, Apple, and any other large email providers at least agree to transparently use a different, secure protocol among themselves? It could be something open-source (perhaps Pond) that other providers could also choose to adopt.
The mail-sending server could ping the recipient server, find out if it's a user of this new protocol or not, and then fall back to email if it doesn't receive the predetermined response.
Even if that only means that only 80% of emails were encrypted on average, that would be an improvement, wouldn't it?
* Getting providers to safely engage TLS for MTA-MTA mail relaying, for instance by deploying key pinning.
* Making existing non-seamless cryptography (PGP) functional enough that it can be used in exceptional cases.
* Deploying new asynchronous encrypted messaging systems --- things like what Adam Langley was shooting for with Pond --- that were designed from the start with security in mind.
Secure-by-default email would be nice to have, but it's not the only option. We could, instead, deprecate SMTP email.