Yes, it will take time for BTC to be adopted by the masses.  There are still technological and security barriers that need to be overcome.  When Bitcoin is as easy to use as sending or receiving a text message or e-mail then you'll see wider adoption and circulation.  No new technology becomes widely adopted overnight.

No one in the bitcoin community can manipulate the total supply of bitcoins.  Those who constantly expand the supply of fiat money do so arbitrarily and issue that new money in the form of debt.  Unlike fiat, the inflation of the bitcoin supply is controlled and predetermined and is not a debt.  That's a huge difference and there is nothing anyone can do to change that.  Those who find that inelastic supply unacceptable can choose to use a different currency, but they can't choose to change Bitcoin's parameters.

If slow confirmation times for small transactions become an issue then someone in the market will come up with a solution.  Off-the-blockchain transactions performed by a mutually trusted third party could be one possible solution.  Or, using an alternate cryptocurrency like Litecoin for smaller transactions could be another option.  You gotta have faith in the free market.