The thing is - you're essentially distinguishing Guy Steele and Guido van Rossum from Andrew Appel and Luca Cardelli by success. Steele and van Rossum created languages used by lots of people, and so they're "system software designers", while Appel and Cardelli created languages used by small communities, and so they're "programming language researchers". If you set up your definitions like that, it's tautological to claim that programming language research doesn't yield any useful stuff, because everybody who creates useful stuff gets taken out of the PL research category.
The big question is: can you detect, a priori, which research projects will be successful?
For example, would you have funded Dave Moon's research at the AI lab? How about L. Peter Deutsch? Ricky Greenblatt? Kernighan and Ritchie? Tony Hoare? Dijkstra? Knuth? James Gosling? Matz?
The irony is that no matter who you consider relevant, you're almost always wrong a decade later. Moon was brilliant at the AI lab, and his work was the foundation for most of the 1980s AI boom. But it's largely irrelevant today. Matz and Guido were relatively unknown throughout the 1990s, but they're suddenly critical now, because technology has shifted towards dynamic languages. Hoare spent most of his life working on arcane topics like proof-carrying code, but think of how many bugs have been found because of assertions.
What if the next big development in computing comes out of type theory? Would you then add Luca Cardelli, Benjamin Pierce, and Phillip Wadler to your "system software designers" category? (Heck, Wadler has already made important contributions to Java 1.5 generics.)
The university system is built upon the premise that you can't tell what basic research will be successful beforehand, and so you better fund all of it (or as much as you can, at least ;-)) and wait for some entrepreneur to sift through it and figure out what's commercially viable. You seem to think that all that random chance is unnecessary, and you can pick the winners beforehand and shut down the rest. If you're right, there's a very lucrative career waiting for you as a venture capitalist, where you get to bet Other People's Money on the future system software designers.
(BTW, I met a girl at a party who's in a swing dancing class with Guy Steele, and he calls himself a Programming Language Designer. So maybe your title for him is a bit off the mark...)