It can be done, but its work. My originals band (from Milwaukee, mind you), plays upwards of 50-60 gigs per year, and we get paid for every one. But, we hustle like crazy, keep current on our promotion, work the crowd, have our own soundguy, play four hour shows with one very short break, sweat our asses off, buy drinks for new fans, continue to fine tune our set, don't waste time talking between songs, know our transitions, tip the waitstaff, are on time, polite, and approachable, smile, and have a blast at every show, no matter how many people are there.
We also book gigs around the midwest, all drivable, but we do what we have to do to fill the calendar.
My point? The audience is out there. They want good music. They are not all idiots. Yes, the cover scene is bigger, and its easier to stay in the familiar (I was a part of it for a long time). People want to party, not be challenged. That's why its work, but its so worth it. I finally got sick of covers and made the plunge, and I'm glad I did.
Now, back to my real job.