First off, this is a hobby that I enjoy, it rewards me with good times, interesting friends, and delicious beer. I am however not one that likes to spend a ton of money if I can help it, so I have done the following things to reduce my brewing costs (it's actually become PART of the hobby to see how low of a cost I can brew a great beer):
* group grain buys to lower costs of ingredients
* wash yeast to lower costs of ingredients
* grow hops to lower costs of ingredients
* build my own equipment (stir plate, brew stand, chillers, etc) to lower cost on equipment
* trade beers with other homebrewers to get more variety at no additional cost
* use natural gas to lower energy costs
So there are things you can do to make the hobby less expensive, which I think is part of the allure for me. I am an engineer so I like building stuff. I can brew a beer for under 50 cents a bottle these days if I try, not counting equipment costs or salary for the brewer (grin).
I agree with others that the allure of upgrading and improving your equipment and process, and thus your end result of beer hurts the bottom line. Just keep in mind it is a hobby, something we enjoy doing, and is worth the cost. It is fun to do (except cleanup...I despise that part...), it provides great side benefits like new friends and delicious malty, hoppy beverages, and you get to feel that pride when someone drinks one of your beers and can't believe that YOU made it! you can't put a price tag on that...
Cheers!