But we are seeing it, or at least a simulcrum of it - and have done so starting with Elite.
The key word was "nurtured". I suspect the sort of cookie-cutter sandbox paradigm showcased in GTA3 and its sequels is as adventurous as things will get for a while. As long as developers can stay one step ahead of the players "I wonder if I can pick up a whore... hey, I can! I wonder if I can shoot the tyres out now... hey, they added that! etc" then the illusion should suffice.
To be fair, most of the "game" in Elite happens in your head, prompted by fairly barren visual cues - it's a canny product. Frontier, by comparison, added just enough detail to the universe to bring into stark contrast how much freedom you didn't have and was, for my money, much less convincing as a whole. All of this stuff is a balancing act between the context you choose and the level of freedom you're realistically able to implement during development: That's GTA3's major success... you don't actually have that much freedom, but the developers spent so much time pre-empting everything you might try with the available props that you feel as if anything's possible.
Leaping from subject to subject, I agree that a common library of ready made objects would help. Indeed I was talking to Kuju a few years back and they were adamant that modelling houses dedicated to "prop" generation were the only viable long-term way forward. The trouble, of course, is that graphics sell games so everybody wants better looking crates than everyone else and the whole idea starts to fall apart. When every developer is owned by EA none of this will matter, though. :P