"Imagine the truly, gob-smackingly awful RAID-rebuild times of such horrible disk drives."
Yes, a massive 10TB disk spinning at 7200RPM will still take A LONG TIME to rebuild, even sequentially. However, this does not mean that we don't NEED the capacity. If the Gb/sqin increases, more data will flow under the heads per second at the same 7200rpm speed, thus improving the drive's potential sequential read/write speed. We saw this with the jump to PMR. Placing more read/write heads on the arm will further improve read/writes (yes, they plan on doing this, just don't remember the company....). However, assuming a mundane 100MB/s to a 5TB drive, that's still 13.88hrs to fill the drive.
Then there's SSDs. Flash chip density is only limited by the die shrink and how many chips (and channels) you want to stuff into a standard casing (2.5"/3.5" or PCIe card, etc). More channels = more performance (roughly), assuming the controller and drive interface can handle it. Eventually, it might become cheaper to litho (or the like) our storage space rather than BPM a platter, but the endurance of SSDs only gets worse as the die shrinks, hence the research into making nano-levers and the like for more resilient storage.
Is a spinning platter the way forward? Likely not. Is NAND flash? Most certainly not. There are other technologies in development that are likely going to carry us out of our current rust-disk rut and hold us by until the Next Big Thing comes along. Until then, the new 3-platter Seagate 3TB drives will be a welcome product, hopefully causing some 4-5TB drives to show up in the next year or so (not due to tech, as Seagate and simply make a 5-platter drive at any time, but due to the "I want your money" factor).