You make (as ever!) good points, classic fairy tales and myths are pretty silly if deconstructed. It's all about the suspension of disbelief, and I'm the first to admit that this is different for everyone.
Suppose on Skull Island, they discovered a T-Rex that also had helicopter propellors that came out of his head, and he flew around the island killing people with flames of napalm that came from his mouth in an homage to Apocalypse Now. Then he sings the Star Spangled Banner. Most people would, at this point, laugh and / or walk out (me though, I'd lap it up).
It's all to do with the world you create, and the parameters of that world. Now, I think there are 2 issues here with King Kong. The first is that the tone of the film (for me, anyway) does not sit quite right with the evident level of silliness in the story. You could have the above sequence in a Kong movie if it was a Pythonesque surreal comedy, but not if it were a deep King Lear allegory. Setting the tone of a movie is a very tricky thing, and for me the silliest aspects of the film didn't sit right with the most serious.
The second issue is to do with expectations before people even walk through the door. I think many people hear the worRAB "King Kong" and immediately think "silly monkey / dino movie", and pigeonhole it as not for them. Also I think even when people who have seen then try to convince the doubters that "no, really, honest, it's really good", they can't get that initial strong reaction from their heaRAB enough to actually pay eight quid to see the thing. The comparison with Titanic is that, contrary to expectation, people really did want to see it in the first place.
All too true. Some films' budgets are so big - Kong being one of them - that there has to be a belief in the film not just doing well, but being a phenomenon in order to break even. I believe Kong will have to make about half a billion worldwide, which is a pretty sizeable hit. I think it will do this, actually, so by no means is Kong a flop. But neither is it the phenomenon that perhaps they were hoping for - each LOTR film got around a billion, which (at a lesser original budget) got each film into massive profit.
Your points do definitely relate to my own film however! It is unusual - unique even - and (blush) award nominated. At the moment I am told by many that they love the film, but are worried about its marketability, the cold hard reality of getting bums on seats in the first place. If you are curious,
here is the IMDb link, and you can follow to the film's home site from there.