This thread at The Rambler is well worth reading and ought to be fuel for some long-overdue discussion.*
* The degree to which "commercial recordings" of new music are actually commercially viable has, for the most part, always been small. The exceptions are all exceptional — Harry Partch did earn some money from his own Gate Five label (taking advantage of having no middle man and minimal overhead), I assume that Phillip Glass's recordings have generally been income generating, and sometimes there's actually the odd hit that makes a speculative investment in musical obscura pay off: the Nonesuch Subotnick recordings, that Gorecki Symphony or such.
Even in the days in which only a handful of labels existed with any interest in the vanguard, unless the label had deep enough pockets and an inventory-friendly tax code to risk a long amortization periods it was a common expectation that a composer would front the costs of the recording, either out of his/her own pocket or with grant money or the largess of the few patrons we've had. There was really no great problem with this — indeed it put music out there in the world in a useful form that the market participants were not otherwise rushing to produce — so long as the simple existence of a recording was not viewed as anything more that it was, for example as C.V. filler for academic hiring and tenure decisions or for the awarding of grants and prizes and residencies. In the big world of commercial music making, the medium may be the message, but in our little niche, any question of substance has got to turn on the music itself, not on the arbitrary fact of whether it got captured as a vinyl, plastic or downloadable commodity.
Nowadays, actually getting a high quality recording made and pressed, burned or uploaded is cheaper and easier than ever. (A good comparison is to my high school years, in the late '70s, when vinyl was produced by a small cartel of factories owned by multinational firms and in increasingly bad quality, often little more than cardboard sandwiches prone to falling apart.) It has become clear that a prime function of cd recordings now is that of calling cards for composers and performers, as advertisement for the real action: getting gigs. (AFAIC, not an entirely bad state of affairs.) (A friend recently told me that it has become a custom in circles of the well-recorded to inspect the shelves of those who have received their calling cards — to see if the plastic wrap has actually been removed from the jewel cases! No, in the privacy of their own living room, even your best friend may not be your most loyal listener...) Yes, there will always be a small number of "serious" composers for whom a purchasing audience for their recordings exist, sometimes even approaching the conditions of a market, but let's try to be up-front about this, so we fall neither into the trap of over-estimating the prestige value of a recording nor into viewing every recording firm as a vanity press.