It's not necessarily either-or. I grew up in a very old house that a totally separate dining room and kitchen. When I bought a house it was the same. After a major remodel for structural reasons, the kitchen and dining room were opened up--which turned out to be a big improvement--but the living room spaces were still largely separate. This actually works pretty well for me.

In practice, when I have people over, we still spend a lot of time in the kitchen/dining area--which is also sort of the "mud room" etc.--but the entertaining/hangout area is still somewhat separated.

I think more open floor plans than was historically the norm make sense--especially in smaller areas. But, if you have the space, walls can still be useful.