We just got back from Cozumel. Weather was horrible last week but we did get some diving in. Dove with Dive Paradise and they did great. Wish I could say the same about the reefs. Sadly, I think this will be the last time we visit Cozumel.
We haven't been to Cozumel in about 7 years and things have changed. Where they used to get 3 cruise ships a week, they now get 2-3 a day. Prices for everything have skyrocketed and it's much more of a mini-Cancun now. So that was disappointing. Not nearly as bad as the reefs however.
Since it was overcast and rainy, our dives where usually only to about 60 feet. Everything at least too that level was fairly disappointing. Most of it covered with sand. Frankly, I've had better dive trips in Jamaica. Outside of the two nurse sharks we saw one dive and seeing the submarine another, it was very unremarkable.
I'm sorry you had a less than satisfying experience, but as to the diving, I don't think what you saw was representative of the whole reef system there. Some of the shallow reefs, especially the more northern ones, do have sand on them, but certainly not all of them. You said that you only or mostly dove shallow; the deeper reefs are in much better shape than the worst of the shallow ones, and the reefs at the south end are the best of those.
Yes, the development machine is running on Cozumel, but it's not too hard to get away from it. Deeper in town, south along the west shore, and especially over on the east side, there is plenty of the Old Cozumel left. Ironically, the new roads to and from the east side are what I hate to see, since they herald the advent of development over there.
Yes, Cozumel is pricier than it used to be, but what isn't? I have noticed the difference, of course, but it's not a deal breaker for me.