I'm always discouraged from listening to songwriters who write with explicit commercial aspirations. I've encountered a few on this site, and I can usually hear the willed conformity in their music. When you write for "the market," you aren't writing for anyone but money: so often, when people talk about making art "for a living," they begin shaping their ideas and intentions around what they think will make them money. Another approach to "popular songwriting" would be to write music that you believe people will enjoy or identify with. Songs written with this intention could also have commercial appeal, but the songwriter's intention would be to connect with a large audience through new ideas, not through market-based analysis of songwriting convention. To me, this is the true approach to writing "popular song."
Music has an intrinsic power. When we hear certain notes, textures, rhythms, etc., we feel certain ways and think certain things. As an artist, creating music is a thrill because you learn to employ traditional elements of music and to manipulate the music in ways unique to your own self. For me, the purpose of songwriting is to find the intersections between musical ideas and my own ideas, to discover feelings or ideas as I'm writing the song. When the time comes to share or perform, I believe that whatever power the song had over me during its creation can be conveyed to listeners who are willing to empathize.
As I said, I'm always discouraged from listening to songwriters who write with explicit commercial aspirations. These songs rarely have honest feeling to empathize with or a new idea worth trying to understand. Obviously, there are many songs with mixed (commercial/non-commercial) intentions, and Larry's song that spurred this thread is one such song. It sits at an interesting crossroads. I suppose my final opinion on the matter is this:
Make sure the music you write is powerful as music and lyrics, not as an economic engine.
E/S