Ethernet hubs have exactly that same flaw.
I'm fully aware of that. It is unlikely that a hotspot would have an Ethernet hub and even if it did, I wouldn't use it.
Security protocols like WPA-Enterprise and 802.11i solve this problem.
It is unlikely that a hotspot uses such methods.
I had a professor once tell me that WPA-PSK also uses a secure, public key-based handshake, but having looked into the matter a little, I think said professor was full of shit.
I do not see how this is relevant to anything I said.
Most routers on the Internet were configured by idiots, which is why most routers allow remote login, and still use the default passwords. With little more than a CCNA's worth of technical skill, you could configure some of these routers to eavesdrop all traffic to/from a given IP address.
True, but mine isn't configured that way. I'm sure my network isn't hack-proof, but it is a far cry from logging onto a hotspot's wireless access point and conducting business in a coffee shop when there is a fair chance a neighbor is using something like Wireshark to capture everything floating through the air.