A lot of road capacity is needed, but a lot of it is also purely wasteful and entirely caused by social choice.
E.g., the parking lot for the store needs to hold the Black Friday parking demand ->
the store is now too far from the street to walk home with bags ->
everyone drives to the store and there is congestion ->
the street must be widened to accommodate the congestion -->
the street is now too wide to cross or walk along safely -->
everybody drives, etc.
The suburbs are now vastly overbuilt as a result. Nassau County is one of the wealthiest counties in the country yet has been fiscally monitored by New York State since 2000 because it cannot afford the lifecycle cost of infrastructure or services for such a low-density, sprawly environment. And this is despite very high property taxes, to the point where the population is starting to decline.
It reads like that county is a complete shit show and not necessarily indicative of the sustainability of low density.
This is actually part of the problem of the American model; larger entities are always willing to foot the bill, so why bother assessing the economic feasibility of a project?
I agree with your second point, especially as the feds only fund capital costs and state and local has to do maintenance, which they are awful at. The smart strategy is to fund minimum viable operations costs, let stuff crumble and get more capital $ to rebuild!
It does, which is one reason why (in the United States, anyway), highways are paid for by the governments — to spur commerce.
In contrast, railroads (at least in the United States) still mostly have to pay for their infrastructure, which is one reason why passenger rail is in the shape it's in.