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In either system, individual or institutional, yes, you have to deal with the possibility of the patron essentially telling you what you will write/what they will accept from you. This, too, is no different from the present system with television, radio and music.
Generally, whether the patron is individual or institutional, they are trying to make themselves look good, either by profit or by social standing. An artist's job, therefore, is to figure out which type of patron is more likely to be attracted by their work--high-profit patrons for popular works, or culturally-minded for more intellectual works, for example--and target those patrons in their solicitations.
There will still be those who will not get that support, however. I never said it was a perfect system... just that, overall, it does work, IF you manage to become one of the artists that win a patron/advertiser/grant. Those who do not get support will essentially be in the same position as they are in today, self-publishing in the hope of attracting support down the line.
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