You're right, but I think we're distinguishing between the "seats getting smaller" and cramming more people into the airplane. The individual seats have stayed pretty similar, and in some ways are arguably better. However, they have definitely crammed more bodies into airframes, but they typically do that by shrinking galleys, lavs, and premium class cabins.

Spirit has only 2 rows of premium class and they are a bit of an exception at 28" pitch seating.

Until recently, I never bothered to think about how much the overall airplane packing adds to the discomfort of the trip, as opposed to something simple like the seat pitch. However, seat pitch ("legroom") is what everyone seems to care and complain about, even though it's not the whole story.