I like to think the reason twee pop/baroque pop/dance pop/teen rock has taken over is as a reaction to the post-punk/metal/alternative that has been so influential in the past few decades.

To illustrate, I think of the history of music like this (inspired by Wikipedia and music library surfing):

International Traditional Music (I'm talking about everything from tribal rhythms to bagpipes here; for the sake of this lineage though, focus your thoughts on pre-Medieval world music) ->
European Classical Music and Christian Religious Music (Bach, Haydn, Mozart, Beethoven, Schubert, Brahms, Wagner, Mahler, and Schoenberg [aka the German Stem] being the main lineage of sacred and secular art music which dominated world culture and exchanged material with traditional music) ->
Ethno-syncretic Folk Music (This is where African spiritual music and such really took root; it started in Europe but I'm thinking mainly of Colonial forms of music in the new world for this lineage) ->
Blues and Jazz (This is where America took the reins from European Classical and Traditional music for the development of truly "popular" music; something authentically personal for the masses in reaction to the cultural hypocrisy of the old world; developed in tandem with Modernism) ->
Country (This was when white people first started appropriating and mixing in African music with their European traditional music and earlier Colonial folk music; served to fork away from rebellion against tradition to rebellion against elitism) ->
Rock (America lost the reins as the world gained a new idiom for musical expression without cultural boundaries or genre boundaries and united the youth under something which was new yet not part of the art world's avant-garde; eventually led to Pop Art and the Post-Modern aesthetic) ->
Reggae, Heavy Metal, and Punk Rock (The only rock genres that really stand on their own, i.e. are not fusions of other genres but creations of new idioms within the rock idiom, and which led to the creation of subcultures and youth archetypes of rebellion which clashed with each other and the mainstream) ->
Electronic Music (The only logical reaction to the massive spread of rock as the de facto musical idiom; grew from an experimental form to the dominant musical idiom as technology changed our worldview from visceral to virtual and everything was integrated into the mainstream) ->
Popular Music (This is my own theoretical collective idiom; after Electronic, which can now encompass all genres through the advancements of technology, all music will slowly become the same in terms of expression and reception by culture; this will occur in tandem with transhumanism's erasure of autonomous thoughts)

Also of interest:
http://vigilantcitizen.co...a-the-illuminati-puppet/

Off-tangent:
http://www.youtube.com/watch?v=qWr-mGWj0vk
Gypsy music is awesome.