i personally think that one of the main advantages of chipmusic is the quick turn-around time; being able to write and record a track in a day is HUGE, especially when coming from rock music where an album can commonly take 2+ years to record, edit, mix, master and release.
sure, there is a noise/signal issue with so many releases, but i am 100% sure that this is only noticeable "in the scene"; its not like the public is being bombarded with 1000 chip releases. We are lucky if 1 or 2 a year get some public notice, and if anything more releases HELP our odds in that.
I also think that the monthly+ release schedule that many of the netlabels (CDK, Pause, Kittenrock) for the more "quality" artists (debatable, obviously) have is fine, especially considering that most releases are still in EP format and consist of 4-5 songs.
Anyway, i think there is a bit of "get of my lawn" going on in here, but it must be understood that if this scene is to grow, there will be more people involved, and thusly more styles and opinions on chipmusic. yeah, its not what it was 2 years ago, but to be honest thats a good thing.