There is also a thing where station wagons are less and less practical. If you compare a mid 90s Volvo 940 to the latest Volvo V90, the reduction in interior space, exterior visibility and in practicality is huge. Seems to be mostly caused by the trifecta of safer cars (thicker doors etc), better aerodynamics and more styling/design taking up space and making windows smaller.

Station wagons basically morphed into crossover SUVs. It's the same concept - hatchback body on a sedan chassis - but sits a bit higher and has different styling.

Crossovers are basically wagons with the exterior dimensions inflated to keep interior dimensions constant in the face of ever thickening pillars, doors and body structures.

No, I don't think so. If you look at the good ole' Volvo 940 wagon, you get 990 L cargo capacity with all seats in use. A new RAV4 (big crossover) has 580 L in the configuration with the biggest trunk. It's shrunk by 40%.

Unless you have 3+ children, why would you need anything larger than a five-door car for basic errands/travel with family?

7 seaters are intended for those who frequently do pooled trips with friends or family -- and won't buy a minivan. They're not necessarily much larger than 5-seaters, the extra seats fold down when not needed and use up the boot space.

As you say, 5 seaters are probably fine for most people.