We have flu outbreaks every year, and always hundreds of people die from it, mostly old people. The pharma companies always stir hysteria by urging people to get vaccination, but me and most people I know have never had any flu vaccines and I have never got the flu, nor do I know anyone who has ever had the "real" flu. It's the same game every year at the same time.
The flu virus mutates every year, so new vaccines have to be developed. I've heard a report this morning that the "regular" flu is much more aggressive than the new "swine flu". The problem is that the swine flu has the potential to spread quickly, but it can easily be treated and the symptoms are not very bad. If you're already sick and have a weak immune system, every cold will affect you, but if you're healthy, you can deal with a virus like that. We had the bird flu a couple of years back and the media was spreading panick, in the end nothing happened and it was forgotten after a couple of weeks.
You are correct on many counts.
However, with regards to avian flu, why nothing technically became of the fears is that although it was able to infect people, the virus never mutated in such a way to allow easy transference between people. Thus, the ability to spread was totally impeded. If the virus had mutated, the avian flu would have been a very serious concern.
Further, as I mentioned pigs and birds are the natural reservoirs of flu, thus there will in the future likely be another avian flu, but it will not be the same one, and if it shows the ability to infect people concern will once again be raised.
Pigs are a more direct source than birds for flu, as we share a common receptor with them (birds have salic2,4 while pigs and humans have salic1,4 I believe), making transference of virus from pigs to people far easier. What swine flu has shown, and what raises concern, is its ability to spread amongst people - this is what could make it a pandemic.
Media hype and scare tactics will not help matters however, it is merely a manner of concern - something we should monitor and try to contain, not panic about.
Also, with regards to flu vaccines, they idea of giving them to everyone is the theory of herd immunity. It contains spread, as even though you are young and healthy and may never show signs of being sick, you can still be a carrier and infect other people who are at risk.