Another way to look at it: the record industry has always, itself, been a kind of shady industry. Its greatest economic successes has always been an expression of something more (e.g., semi-legal / coerced) than free and fair marketplaces.

To use your analogy, it’s a house whose value has never been simply a reflection of its quality and neighborhood, but of illicit arrangements that boost its sales / profit.

Legitimate file sharing and illegal file sharing have hit the record industry for both sides: on one side, the record industry isn’t setup to work directly in free and fair marketplaces; on the other side, the record industry isn’t setup to be a completely illegal enterprise either.