Advances have fallen, generally, for everything except the biggest potential bestsellers. Given all the changes, both economic and technological, SF hasn't done too badly.
I usually do one con a year as a GoH and try to make the World Fantasy Convention for business purposes. Last year I went to a worldcon for the first time in two decades. I may go again this year.
I enjoy listening to classical music and heavy metal. I play basketball and try to go diving at least once a year. I don't really have hobbies in the traditional sense... I engage in too many activities already through the actions of my characters.
Getting inside the mind of a terrorist wasn't difficult at all. Even as children, human beings fabricate elaborate revenge fantasies. We're not a particular species. Check out popular video games.
We're all nothing but unified arrangements of atoms and particles, drifting around, enjoying consciousness every now and then for a second or so before splitting up to become bits and pieces of trees and stars and french fries.
Keep writing. Try to do a little bit every day, even if the result looks like crap. Getting from page four to page five is more important than spending three weeks getting page four perfect.
Dawn was written well before 9/11. People speak a lot today about the banality of evil, but not all evil is banal. Some of it is carefully structured and well-thought-out. That's where the real danger lies.