I don't think Vatican II has as much to do with those declining numbers as other factors; of course, I feel that John XXIII was probably one of the three or four greatest Popes of all time, and I'm not Catholic, but that's what I think.
VII - virtually "protestanised" the Church.
Take it the other way, if the Church hadn't modernised, and the priests were still the mysterious "intermediary" - would the numbers be any better?
My father was an altar-boy and a good catholic boy, learning latin and all.... but stopped once VII happened... if he couldn't use the latin. What's the point?
I have no problem with a number of the edicts of Vatican II,
however I would argue that Vatican II has clearly established a new culture in the Church that has been detrimental in many way.
First off, most of the changes that came from Vatican II, in terms of how the Church relates, officially to society and other Christian and non-Christian sects had been
de facto the way things were for a while until that point. So those "changes" weren't really all that necessary.
Secondly, (getting to Polnut's point) in terms of how the faith is actually practiced, I think it has had detrimental consequences. Forget conducting the spiritual rites in Latin... certainly that was disposable. However, the way things were conducted, the meaning that had been built up in the mass over every little thing that was done suddenly had no meaning. And if those things are changeable and easily disposed of, then what prevents the wider things from being so easily subject to the winds of change.
People are demanding another council so that the Church can readjust to the world, even today, only 40 years after the last council. People have come to assume that things can change whenever we want, for whatever reason, because society demands it to be that way.
I think these problems listed above, while not a direct result of Vatican II, do stem from the culture that emerged afterwards.