The engine is optimized to be generator, but that doesn't mean it has to be involved forever-more; the reason we started seeing plug-in hybrids ten years back is because the changing battery chemistry means we can fit enough range for something useful in-town!
Once the battery-only-range gets far enough (versus fuel + engine), then the engine in your plug-in-hybrid disappears completely; it was only a matter of a decade!
You're not wrong. Double the range of a typical EV and even here in NH, it could work. A full tank of gas can get my to my parent's house in Maine, 4 hours away. Tesla can do it under ideal circumstances with one of the long range variants without a charge in-between. With my Subaru I can make the entire trip on a single tank easy (at >34 MPG I might add,) and filling the tank takes a couple minutes once the pump is going. If I go to visit them in the winter (which can get very cold up here,) then my range is reduced and there are limited areas in Maine to charge, but it is doable. Once I get to my destination, I probably don't have 230v for charging either, so that's 120v at a snail's pace.
I guess my point is that gasoline is still far more convenient if you're not just focused on driving locally. If you're not going long distances, EVs make a lot of sense, but until the range can match or exceed ICE vehicles, like closer to 400 or 500 miles, the shortcomings of recharge locations and times will continue to be the bane of EVs, at least for the kinds of commutes I've had to deal with traditionally.
With that said, I don't go far distances very often anymore. So it's the exception rather than the rule since I work remote now, but I always consider the furthest I'll need to drive.
All in all, I agree with your assessment, just maybe not the outlook. I don't see the ICE being dead in 10 years in the US, forget developing nations.
EDIT: Honda Clarity 2021 are still on sale around me. They start at $33,000, so the $7500 tax credit effectively drops the price down to $25,500 base value. Not bad for a 5-door sedan, especially in this market where everything is overpriced. (Yes, this is _today's_ price, though all the inventory is sold out...)
When I bought my 2015 Subaru Impreza brand new, the sticker price was 19.5k USD. Base model, sure, but new nonetheless.
It has 138k miles on it now.
It's very much a team effort, and I appreciate the enlightenment on the engine; hadn't known that. A Prius wouldn't manage its stellar city economy without the hybrid system and the associated regen braking.
Toyota does crazy things with engines. The D4-S system is another good one (direct injection + port injection.)