Increasing the blocksize limit is a possible short- to midterm solution and it's increasingly discussed so this might be undertaken in the near future. I imagine a blocksize of 10 MB is possible thus increasing the limit to 70tr/s. This is already quite impressive and should be enough for a couple of years.
Gavin has all but said an increase will happen in his last development update.
Bigger blocksize does not only increase the storage requirements but also the time other miners verify a block and thus the risk of producing an orphan block. I've not yet heard of a solution how this might be circumvented.
That's a feature, not a bug.
https://bitcointalk.org/index.php?topic=140233.msg1503099#msg1503099I think the longterm solution IF Bitcoin becomes a transaction currency instead of a speculation object is more off-blockchain transactions. How to make those secure and reliably integrated in the main blockchain will be a challenge.
Off-blockchain transactions are a
terrible idea, and aren't even necessary. The optimizations needed to overcome the challenges you are referring to are not a mystery.