Apartments don't have to be cramped, they can be spacious, and they don't have to be noisy, if you build them with thick walls. So the question becomes: why aren't we building more apartments like this?

City living (at least near me) is definitely worse than suburban or rural living, but I don't think that's an unchangeable fact. More and better dense housing, mixed use areas, public transportation, and public common space are all vital to a healthy city. I believe that the lack of these is what drives people out of the city and into suburbs.