Another thing:
Most guys don't like going to brothels because they can be seen entering, leaving, while inside, whatever. Access to independants for them (thru sites like eros, etc.) is seen as a giant leap forward, as the brothels weren't the preferred mode, but what they had access to ( and outcall meant getting a hotel, etc.). Independant incall is a fairly new thing for the mass market audience (obviously it always existed, but not nearly as much accessability to it ..... just look at how CL has exploded).
But I still think the "barriers to entry for a higher end spot" is one of the main reasons why you don't see too many anymore, followed closely by the "it's the economy, stupid".