We agree on all those points. All I was saying is that people say "cities are spread out so transit won't work" when often the very _reason_ cities are spread out is that they lacked transit, so huge amounts of land were given over to auto infrastructure. It's worth considering that it's self-reinforcing and the causality isn't one-way.
Look at a big box store, for instance - most of the land is parking, not the store itself. A freeway interchange can take as much land as en entire neighborhood. Meanwhile you can have tens of thousands of people in a city centre all within walking distance of one another. But you can't do that if you pave over most of the land.
Also, it's illegal in most of the US to build infrastructure that isn't suited to an auto-first lifestyle, mostly through parking minimums but also Level-of-service considerations that force large, wide streets.
In California, SB827 just died a sad death. It would have allowed buildings up to 5 stories near high-frequency transit stops. Now those people who would have lived in those buildings will have to live farther from transit, so they'll drive. They'll need parking too, so we'll need to use land that would have gone to homes/businesses/etc for their parking. Also gas stations, more road capacity, etc. The homes they end up living in will be harder to reasonably serve with transit, because of course they're farther apart.
Yet old neighborhoods near cities built _before_ those rules are often very expensive, suggesting that more people would like to live in them than are able to. The first thing that comes to mind is the nicer areas of Berkeley, or South Park, San Diego, for instance. It's funny you note railways though because they were largely the original enablers of sprawl (though I have no problem with railway-served suburbs! the problem is largely that we got rid of the rail service).