What's more expensive, a toy that gets used once on Christmas day and then gets discarded that costs $10, or a lego set that costs $50 and that gets passed down three generations or more?
Some of the lego my kids are playing with went through this route: my uncle, me, my brother, my son, my brothers kids. The oldest pieces I've got are from the early 60's, they have a different formulation and didn't keep their shape as good, but anything produced after roughly 1965 is as good as new today.
Just to add some details on your parts from the 60s, Lego began switching from Cellulose Acetate to ABS plastic in 1963 and the switch was complete by 1966, so your estimation of part quality during that period seems to be spot on.
My son is playing with the bigger Lego pieces at the moment (Duplo), and I have the impression that they wear out a bit. What I mean is that they won't stick together as tightly as in the beginning. For example we bought a used set from ebay that includes a crane, and the crane is very prone to toppling over because it doesn't stick to the base very much anymore.
Anyway: what is the best way to clean LEGO? I've been wondering about that for a while :-)
My son is also starting to enjoy Duplo, he's mostly using my old sets from about 1986 and they stick together really well. For christmas some relatives bought him a new duplo set and it is noticeably less sticky. I suspect they're trying to make it easier for very young children to casually play with, but it comes at the expense of being able to make the really tall structures that kids inevitably want to build.
My hunch is that if Duplo was built out of ABS like the standard Lego bricks, they would be a lot harder, a lot heavier, and an order of magnitude more expensive. The softness of the cheaper plastic, as mentioned above, is a lot more friendly to toddlers as well.
A dishwasher is the best method I've found for cleaning Lego.
I suspect that duplo is made to be a lot less grippy as it's designed for younger children with much less dexterity. I'd imagine that this means that its deterioration is quicker. Also it gets chewed more.
My son had the ultimate Duplo collection. A few push trains. The electric locomative. Lots of extra track, including gates, switches, cross overs, bridge. A farm set. An airplane.
Just creating a new track layout each time was huge fun. Teaching him planning and problem solving.
We'd play "keep away", where you try to use the switches to divert the locomotive to crash his each other's push train while avoiding getting hit. Huge fun.
We'd play "farm riot" where the farm animals break out of the zoo and eat every one. Kind of like a zombie apocalypse.
We'd play "ValuJet!" where the plane would fall out of the sky. Not very complicated. You hold the jet up, swoosh around a bit, yell "ValuJet!" and then crash the plane into the people, trains and buildings below.
We'd play "Amtrak!". That's when the train approaches a crossing gate. Also pretty simple. You stuff a lot of people onto a train, yell "Amtrak!" and then hit the car stuck in the crossing gate, derail the train, everyone dies.
Duplo trains are superior to those crappy wooden Brio in every way.
Our Duplos got more play time than any Legos since, even the Star Wars sets. I just passed them down; it was super hard to let go.
My boys have Duplo, Lego, and Mindstorms part-recovery parties regularly, and we just chuck everything in the dish washer. Things fit surprisingly better after that!
Some exceptions I've seen are cracks where the hands insert into the arms of minifigures and discoloring, particularly on white bricks. And of course there are missing pieces, but that's not a quality issue.
This summer I bought a set I grew up playing with (#6345 Aerial Acrobats). It sits on my shelf for now but I'm sure I'll play with it with my future children.
Some of the lego my kids are playing with went through this route: my uncle, me, my brother, my son, my brothers kids. The oldest pieces I've got are from the early 60's, they have a different formulation and didn't keep their shape as good, but anything produced after roughly 1965 is as good as new today.