While the CSS spec was designed to keep in mind various media types, the industry standard is indeed a 'm' subdomain for the mobile version of the site. I think this need has arisen because the use of HTML/CSS has gone well beyond minimalist content markup of documents, to full blown GUI websites (i.e. sites with complex navigation bars), which doesn't exactly transfer well onto mobile. I think this is why only the simplest of sites (i.e. blogs, text search engine results) will be able to display an alternate stylesheet for acceptable mobile presentation.
More complex sites would need a more tuned site (i.e. m.wikipedia.org - notice how the edit stuff is cut out for example)
ps- i hope i've understood your contention correctly :D