Spot on, this is what we do on www.post.fm (sorry for the plug) - organize your email around people & organizations, and then offer distinct user experiences based on various use cases (going through notifications, participating in threads or groups or chatting one-on-one with people you know).
This HN post shows how passionate people still are about email. I have to admit reading the comments has been like reading through my own thoughts for the past 2 years we've been working on this. I can't wait to share what we've done with all of you.
PS Email is indeed great. The protocols - not so much. Unfortunately most email clients are limited to using IMAP as the email API, which in some ways limits what they can do with email. Hotmail started as (and probably still is) just an html client for IMAP. So the UI is built around IMAP functions - get a list of headers, etc. Forget running sophisticated SQL queries against your inbox, the user experience is dictated by the API designers - never a good choice.