Yeah, my only thought after reading this is maybe curators need some improvements, because I don't see what other solution there would be. I don't want a single person employed by valve to be curating, I think many people would agree on that point. There is no data-driven model for "exposing indie gems" because what is a valuable game experience is human subjective and not even sales or reviews accurately tell me if I'm going to like a game, they're only the roughest approximation.
I'd also just hazard that if the problem of the market is "exposing more viability for smaller niche products beyond the capacity for any human market that has ever existed in history," we're in the realm of nitpicking for utopian solutions. I'm not saying there isn't improvement to be made here, and you've written a more reasonable assessment of the issue than I see elsewhere, but the plain reality is the current Steam market surfaces to me more individual creative art objects that I can pay someone to interact with than has literally ever existed, and it's already by default currently better than any other model I'm aware of.
Etsy is worse, Spotify is at least slightly worse, all streaming platforms are worse, twitch and YouTube are slightly worse. Most forms of niche media require "marketing" of some form -- social media, word of mouth, etc. Steam meanwhile has curators, a discovery queue that you can click through endless games related to your interests (but few people ever seem to bother using this for some reason), massive sales that consistently surface an enormous range of games, massive demo events that surface even more. You can infinitely scroll down the front page for more and more and more game recommendations. Everyone is out there fighting on Twitter and other social platforms to get wishlists to get attention to get sales, but like, what is Steam supposed to do to step in beyond that? At a certain point, interest requires a customer who cares to put in the effort.
Last note I'd say is people really under value the discovery queue. I've scrolled through thousands of games at this point, bought and played and recommended many I never would've found otherwise. But there's no system in reality that could have put 3827 (as of now) games in front of me to consider without me putting in the effort of clicking through the list.