So, you start by assuming the answer to your own question: "This means either merchants aren't seeing too many bitcoin sales OR a lot of these sales are happen

So, you start by assuming the answer to your own question: "This means either merchants aren't seeing too many bitcoin sales OR a lot of these sales are happening offchain through coinbase/bitpay." (...) "in the latter scenario..." And then you say something that makes little sense... what giant fee are you talking about?? Merchants are actually offering DISCOUNTS for payments via Bitcoin.