Fantasy has not, of course, been absent from literary fiction, but it has been admitted to the mainstream generally only when pedigreed (Martin Amis's Time's Arrow), political (Margaret Atwood's Handmaid's Tale) or exotic (which is to say, Latin American). Fantasy and science fiction as a capital G genre, meanwhile, has largely been shelved separately from the rest of the culture, in part because of the genre's mania for self-classification into ever-narrower niches (high fantasy versus alternate history, hard science fiction versus space opera, cyberpunk versus steampunk) and in part because of pure snobbery.
(typography corrected) The major problem with this passage is that it is implies two different, and false, conclusions.
The first—and most obvious—is that other categories (there's that word "genre" misused again!) of fiction do not engage in this kind of subdivision. Hogwash. Just look at "legal fiction" for a moment; you'll see "courtroom thrillers" (further subdivided into "client-oriented" and "lawyer-oriented"), action/adventure/thriller books in which the characters just happen to be lawyers, polemics on particular legal issues, romances in which the characters just happen to be lawyers (if this is not too much of an oxymoron), and more. That's not just me speaking, either; that's publishers' account representatives, although perhaps my cynical descriptions would roll some eyes.
The second—and, in the end, more harmful—is that the category does this to itself. Leaving aside the epistomological impossibility of this, it further implies some level of incompatibility among the various subcategories, such that they do not mix. In other words, one cannot be a fan of both the St. Louis Rams and the Oakland Raiders; of the Seattle Mariners (who, this year, have returned to form) and the Minnesota Twins; of Manchester United and Ajax Amsterdam. That there are individuals who find this impossible does not justify the conclusion that the categories themselves do so, rather like Friday's WWF challenge at St. James's between the Ancients and the Moderns. To say the least, this bears little relationship to reality, as I'll be more than happy to demonstrate in Boston over Labor Day.
Speaking of little relationship to reality, consider reality TV (the second-greatest oxymoron in English—after only "civil war"). Or, better yet, don't. Unfortunately, the networks do, probably because it means not having to pay writers or admit that very few writers can actually and consistently write more than mere drivel under the time and production pressures imposed by the TV industry. (There's a good reason that the UK's TV series are seldom more than a dozen episodes, and that many of the very best are six to eight per "season.") Of course, that means that the idea is now the primary indicator of potential value; and, where that is the case, idea theft (or at least accusations of it) can't be far behind. Let's just say that it's not just the actresses/actors who get screwed to get a job…