Your look on the past sounds a bit US centric to me.
Outside US, specially in Germany, the situation had been quite different.
Hi-Fidelity started some time before 1970, and soon very high quality headphones appeared, e.g. the very famous Jecklin Float electrostat. Sennheiser made the HD 414 (my first headphone when I was 15), 420 and 430, the latter quite close sounding too what they do today. Then they came out with the Unipolar 2000 (my second headphone when I was 17), their first electrostatic model.
Being completely open it lacked bass (needed EQ), so they improved it with the 2002 semi open variant.
At that time Stax of Japan already had several electrostatic models developed over a decade, culminating in the SR Sigma and Lambda. Beyer had the DT880, a dynamic sounding close to an electrostatic, my 3rd headphone, a variant still offered today.
There were other headphones manufacturers offering high quality models, especially in Japan, Germany and Austria, names partly still present today: Audiotechnica, Pioneer, Micro-Seiki, Sony, Foster, AKG, Beyerdynamic, Peerless-MB and more, ages before “Dr. Beats” appeared.
Headphones had their place at that time, acknowledged for sounding better than the best speakers in some way.