The Truman Show is a masterpiece for three reasons:

1) The acting, direction, writing, etc are all first-rate. Peter Weir is one of my favourite directors, and in this, he made one of the best films of the 1990s.

2) The film satirises audience manipulation in television to a hilarious degree, bringing into question their culpability, bread and circuses style, in many respects (as you point out). It also has fascinating spiritual undertones in a variety of interpretations (Christof can be seen as God or the Devil). And I agree, it is devastatingly sad. Truman may escape, but how is he going to cope in the "real world"?

3) Most emphatically, this film anticipated reality television. I believe it was a warning that wasn't heeded. I can say, without hypocrisy, that I have never watched reality television. I refuse. I believe the likes of the Kardashians, Big Brother, Love Island, The Apprentice, The X-Factor, and so forth, are the modern equivalent of gladiator contests, throwing Christians to the lions, etc. I want no part of them. They are morally repugnant emotional pornography appealing to the basest and worst instincts of humanity. Drama is one thing - a noble art - but I draw the line at reality television, and always will. (Incidentally, I know people who have worked on these programmes, and the amount of psychological profiling for maximum drama and humiliation would horrify you.)