As unintuitive as it seems to me, a sizable minority of people use Facebook as a way to meet others, either for dating (read: hooking up with your friends hot friends), shared interest, or just adding another source to the stream. Perhaps this is what keeps others active on the network? The few who activity seek out new connections keep everyone else just engaged enough to keep posting pictures and a few lines about their life.
I agree with OP in that Facebook that greatly taken away the ability to find people who are into a specific topic. I would like to find people in my area who like the film "El Mariachi". There is a Facebook page for it here: https://www.facebook.com/ElMariachiMovie I can see that 30,000+ people are fans of the film. Great! However, I can't see any of these people (let alone their proximity to me). The best I can do is maybe post something to the page, which will NOT appear by default, and may or may not get lost in the noise about other posts about actual Mariachis or maybe Mexican restaurants with the same name. The functionality related to one of my favorite books is even more bare (https://www.facebook.com/pages/The-Man-with-the-Golden-Arm)!
This leads me to believe that (in the wake of privacy concerns) Facebook is no longer designed to help you meet strangers. You might find someone with similar interests, but it is likely to be a friend of a friend. This might be intentional. It's not necessarily bad or wrong, but I think it is important to call it out.
I love this line, "..For the most part, it's a collection of people whom you used to know, but whom you know less and less as the time goes." Because it's so true, for me. Other than the small subset of people of which I am close to. Everyone else fits this bill for me. People that at one were acquaintances or slightly more, but over time I want less and less to do with these people. I know less and less about them, despite their personal life flooding into my feed. Interesting to me, without facebook, I actually might have more interest in at least a few of their lives. "I wonder what so and so is doing, I should give them a call." With it, I know what they are up to, every day, and I'm not interested at all.
Every so often I find myself jumping into discussion, ranting, or arguing with people I have never met personally. But there is absolutely no incentive for me to go out of my way and randomly message, comment, or talk to anyone I'm not close with via facebook. I will admit that I think facebook has tried in the past to encourage some of this behavior. It's just something that I don't think they've ever been able to pull off.
Sure, there are people who operate differently, but I really don't see any evidence that FB is designed for that kinds of use. If you "friend" people indiscriminately, your list will mean less and less with each person added.
Another part is covered by reply of dfxm12.
Some websites allow you meet new people and to get to know them better over the years. You'd think "social" networks should do that as well, but they aren't. In fact, Facebook sort of works in the opposite way. For the most part, it's a collection of people whom you used to know, but whom you know less and less as the time goes. It doesn't allow for much real communication (which is essential in preserving any kind of meaningful relationships) and it's designed to discourage speaking with "strangers". (Remember all those warnings about not friending people you don't know?)
What irritates me to no end is that there are lots of people who seem to be (socially) incapable of using email, IM or phone to share the same information they share on Facebook.