The interesting and weird thing that underpins these questions is, as David suggests the relationship that design and art and art and design have always had. The birth of the design occured when artisans transformed and modulated their creative urges into expertise in alignment with the industrial revolution and the idea of creative function. It seems to me that in a strange way we have gone full circle to some extent.
The dissenfranchised designer exists – functions and problem solving are no longer enough. The designer see's a cultural capital contained in art and presents his ideas as limited addition, in a gallery setting. A lot of the design work championed by the press is the 'hype-scene' material that bounces the camera flashes in infinite directions. It's no different to Posh & Becks – I don't really care what outfit Victoria Beckham is wearing today, but weirdly I find myself looking when she's in the news for an attention grabbing glamourous showcase. Design is no different.
Vulgarity in design is 'cool'. It's not that important, it will be different tomorrow, it makes the world rich and quirky in a self-expression of the designers' ego. Design as Art and Art as Design: the spectacle is certainly not the future, but its part of it I think.