You’re essentially saying that emacs has been stagnant and hasn’t changed with the world around it. Yes, absolutely. That’s why it’s not a surprise it is losing popularity.
Clunkiness and baggage is not a foregone conclusion for software. Software can keep up with a changing world, discarding old baggage along the way. In the end it doesn’t matter. Whether it is old software that adapts and changes or new software that supplants stagnant, clunky software. The world uses whatever is easiest and most relevant and goes on.
That's not as clever as you seem to think it is. Emacs was created for a different world. Of course new tools have an easier time in the world for which they were created and with no legacy baggage.