A key phrase operates in your tale of the Powells with "a combined income of about $75,000" and down payment savings of about $85,000: ". . . they just don't like most of what they see." In other words, for such people it is not can't but won't.
Between can't and won't lies the compromise wisely sought by Rezowalli and Dean who "wanted to live on the Westside" but settled for a house in Whittier. That's the sum and substance for those who really want an affordable home.
I still want a home on the Westside myself. But I found advantages in a view, privacy and seclusion where I settled near Highland Park that I never could have dreamed of on the Westside. I don't think it's rationalization when I say those factors have been found to be more important to my changing concepts of quality of life for the long run.