Don,
If you think about some of the flatter older courses that have had a significant impact on the development of the game, such as Musselburgh, TOC, Royal Worlington & Newmarket, Garden City, and so on -- there's no question we've moved away from using the types of properties these courses have. Sites that are generally selected today are much more dramatic, have far more elevation change, and there is more emphasis on the "wow" factor. If you have a spectacular site with dramatic features then you'll want to use them. It's human nature and, by extension, landscape architecture.
In my experience it is not that architects are misguided in their use of the most attractive visual aspects of a property, at the expense of contours. It is more that the types of sites that are spectacular, generally speaking, lend themselves less well to the creation of the smaller-scaled features that are the hallmark of genuine golf. A four-foot ridge at Musselburgh impacts play. The same feature introduced on a tee shot with 100 feet of elevation change just disappears.
On the flip side I believe an attractive backdrop can actually help make flattish ground and smaller contours palatable to the "retail golfer". A site on the west coast of Ireland may serve as an illustration. Renaissance was going to build one course there, C&C another. It may happen some day. A number of holes on the C&C course had very subtle contours (virtually flat) which, taken alone, would have been less than compelling. The "wow" factor, however, was provided in spades by the towering sand dunes that surrounded the flattish ground, and the lovely views in general. Because of the views we were free to look for the most attractive settings and focus on the smaller contours.
To your question about whether "better" golf is sometimes passed up in pursuit of better visuals, in my experience you're always making a judgment between the merits of an isolated feature vs. the bigpicture. Often there are features on a property you'd like to use but can't justify using considering what you'd be giving up to do so -- a la Tom's comments about the ocean holes at PD.