The level of demand that exists for a domain isn't just about how many extensions are taken or how many websites exist that include the term, but how many of those domains are developed into successful and functioning websites and ultimately how popular those websites are.
No offence, but I quite disagree with everything you said, Brad.
Question of POV, I guess. For a domain, DEMAND is
how many people want it and/or register it (and/or buy it from someone else). It doesn't matter if it's only domainers believing in FUTURE demand and who are trying to "frontrun" end users by registering the domains to try to resell them later.
That's still some demand! You may argue it's "fake", it's "not useful", or whatever you want, but I believe it's still DEMAND nonetheless.
As for the entertainer, there is still demand for him as he's booked (and paid by the people booking him, it seems). Now, the fact that nobody shows up isn't probably good for his FUTURE demand, but doesn't do anything to his PRESENT demand.
I guess it all depends on how you see it on a TIME HORIZON. You seem to focus more on FUTURE demand. What we were talking about is demand right at this moment. Future demand is harder to assess as you have to have some anticipation about the future. Which (some) domainers may actually do, and they translate this anticipation into present demand. Will they be right or not, that's the 100 points question. Usually only the future will tell.
There is also the point of WHO demands WHAT and who sells what (who is getting paid?): For the entertainer example, we can note I was talking about the demand from the people booking him, not demand from end users, where indeed, it seems there is none. But the entertainer is probably paid by the "clubs". The clubs are paid by the end customers. The lack of demand is for what the clubs are offering. I get the point it is probably because of the entertainer, but only INDIRECTLY. Sure, it will probably have consequences. Usually, just a little later.
The fact that domains are used for websites which are successful doesn't really impact directly demand for domains. People running these websites may be getting paid one way or another, but it doesn't do anything to domains. Maybe some of them will stop and drop the domain if things don't work out. That's only a maybe, and may take time.
If there are just people wanting to try it out, or just people sitting on the domain by paying the renewal fees, that's as good as a successful website, IMHO.
(there is also the question if you consider "demand" as only the fact someone BUYS, or if KEEPING a domain is also "demand". In any case, the latter at least reduces the offer available).