I think my favourite retort to "we can pay you in exposure" that I've ever seen has been "people die from exposure." It's just so succinct.

know nobody who hears an artist on a streaming service and then does anything past listen to them on said streaming service

Please allow me to introduce myself lol.

I go to live shows pretty frequently, maybe every two months or so, and my first exposure to many of the artists I've seen came from a random Spotify recommendation. I don't think this kind of thing is particularly uncommon among people who go to shows frequently. If I don't learn about them from Spotify, I heard about them from a friend or online community that was listening to them. Music really moves through social networks, so exposure can have some real value, though I agree it's rather cruel to literally not pay an artist and simply tell them they're getting exposure.

But hey, if exposure truly was worthless, advertising wouldn't be a multi-billion dollar industry.

I get your point but it really depends on the audience you're looking at. Personally, I use Spotify a lot to listen to any new artist I can find and check their stuff out without crawling a) youtube or b) buying their records in advance. If I stumble upon some stuff that I'm really into, I look if there are any vinyls available. (Bonus step c): you're two months late to the vinyl release and the discocks are already hoarding all copies, smh.)

The point you've made kinda boils down to the question if music is a hobby or a commodity for said person. The "problem" I'm seeing is that music is more of a commodity to many people that just listen to stuff for the sake of listening to it. That's just a product of changing times and the relation between people and music and the distributors inbetween reflects that. Of course this is frustrating for the load of talented artists that just niche audiences care about.