I was a teenager during the 1970s, and am in my 50s now. There was no ballroom in the high school social scene in the 1970s. Saturday Night Fever, which started the Disco "craze", came out in 1977, but sling hustle seems to have taken a while to develop after that, and it never became a standard thing to do the way foxtrot and swing were decades earlier.
In the 1950s, sure, there was enough ballroom and other partner dancing to support big ballrooms, as Steve Pastor points out. People who grew up then are in their 70s now, though, not their 50s.
If you're seeing people in their 50s in the studios now, it's because, as others have said, their kids are grown up so they have time and money to spend.
Sure. That's been true of franchise studios for a long time - I know that in the 1980s, a large majority of their students were retired women. I do think they might be in trouble as those people in their 50s retire in the coming decades, because unlike the current retirees, they weren't exposed to ballroom as kids, and might choose other activities.
Meanwhile, in this area at least, there are independent studios springing up that specialize in kids or in other age groups.