That's still consumption of images rather than participation in reality. Kids can absolutely read in excess as a form of escapism. Books are easier than dealing with real life when someone else does the thinking and problem solving for you. Certainly great for learning in moderation but you won't learn interpersonal skills or how to ride a bike just by reading about them.

I don't think there was. But even if so, there was a time people used to think the same about drinking antifreeze, too.