The grosses for 2004 actually set a record high. In regards to 'The Last Temptation of Christ', Medved's speculation about why Scorsese made the film is completely wrong.
Scorsese had worked on a script as early as the 70s. A time when projects that outre were much more common. Because of financing continually falling through he had to wait till 1987-1988 to get it made. Scorsese considered going into the Priesthood as a young man. That movie had nothing to do with any in-crowd. It was the personal work of a troubled believer. The reason it failed commercially is that non-believers avoid religious themed films altogether. And the believers certainly weren't going to go.
Medved did mention Scorsese being a former seminarian. The equally fascinating book "Easy Riders, Raging Bulls" did give considerable space to Scorsese's "issues," among them his love-hate relationship with his dad. Particularly when he was first grappling with success in the seventies. But that only goes further to prove the point, i.e. the whole thing was made so an angry ex-catholic could get back at the church [perhaps Father Fuddlebottom fondled him behind the vestry back in the day], indulging in some cinematic primal scream therapy at the expense of the investors.
That's more plausible. Scorsese still claims to be a believer. Don't you think Gibson, with his film had a bit of primal scream therapy himself at how he feels the Church has gone too liberal? Catholic themes are all over Scorsese's films. TLTOC just literalized them. The ironic thing is that the Vatican wouldn't subscribe to either Scorsese's or Gibson's ideas about the faith. As for knowing it wouldn't make money...some things just aren't destined to appeal to a mass audience. It all depends on how many 'consistuencies' of viewers you can appeal to. BTW: That 'Easy Riders' book, while a completely addictive read, has been discredited by just about every director that Biskind quoted...saying he misrepresented them completely.
Your analysis rings much closer to truth with me.