In the "How Bad Can I Be" sequence, at one point, The Once-ler's body begins to grow bigger than the land around him; in other words, he, like his corporation, starts biggering.
As does his ego.
It seems a little odd that the Once-ler's business growing and him becoming rich was condensed into a three minute montage (cool as it was) in the film, since that took up most of the bulk of the story in the book. But the Once-ler is the one telling the story, so of course he'd want to skim over the part where he turned into a corporate douche.
Or perhaps the Once-ler actually went into full detail with this part; I mean he fully acknowledges that it's entirely his fault. And I think that the musical numbers are used for the most important parts.
Given that Word of God stated that five entire years pass during How Bad Can I Be, that would indicate that Once-ler was deliberately condensing and/or putting off the more unflattering part of his story. Integrity is a trait he is sorelylacking, which is why he's not the hero.
The Once-ler's "it's a girl, isn't it?" comment. Ted's doing something crazy and possibly stupid to impress Audrey. The Once-ler got where he is trying to impress a girl too—his mother.
The reason for everyone's stupidity— inbreeding and the chemicals in the air and water (at least for the post-Lorax scenes).
Though it may be just because of how perfect Thneedville is supposed to be and how literally no one except for O'Hare, Ted, Audrey, Once-ler, and Grandma has ever been outside for generations.
The Onceler's business strategy of completely wiping out his source of income seems short-sighted, even from a profit perspective. However, the thneed is shown as a stupid short-lived fad that no one needs. Once the fad died out, his source of revenue would have ended whether the trees he needed to make thneeds still existed or not.
If there are no trees, where does the oxygen come from? The answer seems to be chemicals or possibly algae.
Algae is actually the source of the majority of oxygen in the atmosphere now(remember, most of Earth is covered in water and algae is everywhere in that water, the tiny bits of oxygen they produce adds up), not trees.
Phytoplankton does indeed provide a good deal more Oxygen than trees, but the movie establishes that O'Hare has lots of control and power because he sells clean air, which he makes. How does he make that air, and the very fact that he needs to implies something about the amount of Phytoplankton in the water. Perhaps they died out, and he keeps a culture for himself?
OK, so the Lorax sent the local fauna away to find a better place to live. Fine. But how many casualties were there before that happened, that we didn't get to see? I get that Dr. Seuss, generally speaking, is a Never Say "Die" kind of author, but at least a few of those Barbaloots had to have died at some point, whether by a tree falling on them, or starvation as the trees were chopped down. And, while we're on the subject, we see the humming fish climbing out of the polluted water. Unless they were actually amphibians (admittedly, not out of place, seeing as this is Dr. Seuss we're talking about here), they drowned in open air (since they were, you know, fish). Put another way, the Once-ler caused the extinction of the humming fish!
The Humming Fish were seen on land before the water got polluted, so my guess is that they are amphibious. Most of your point still stands, though.
Biggering (the cut song) did imply that some of the animals were dying.
I always took this differently. I always inferred that thanks to Dr. Seuss's Never Say "Die" nature, "being sent away" was a euphemism for impending extinction.
The Once-Ler spent HIS ENTIRE LIFE regretting his actions, you can only wonder the kind of thoughts he had over the years....
Mr O'Hare was last seen flying uncontrollably out of town into a barren wasteland with a rocket strapped to his head. There are a number of things here that could go bad.
Mr O'Hare sold air. The very thing people need to survive. So what if you couldn't afford air? Mr O'Hare has the power to deny Thneedville survival.
A cut verse from the opening "Thneedville" song has O'Hare gloating "everyone around here works for me". Some fans have suggested that this verse was cut precisely to remove fridge horror: namely, the implication that mass unemployment would ensue after O'Hare's banishment.
Entire generations of people has either been killed by pollution long before their time or been chased out of Thneedville by O'Hare - Grammy and the Once-ler are literally the only gray-haired people you see. Everyone else seems to be under the age of roughly forty or so.
During the song 'Thneedville' it says "We don't want to know/where the smog and trash and chemicals go", and then a little boy comes out of the water from swimming and starts to glow. This implies that the poisons are in the groundwater. Which runs into the dirt. Where they planted the Truffula seed. Yeah, that seed probably died soon after the events of the movie. And we just banished the only other air provider out of town on a rocket! Yay!
You'd be surprised how much toxins a plant can absorb without harm. In fact, planting fast-growing vegetation such as willow is used in real life to remediate contaminated soil.
In the movie, when the Once-Ler is informed that its too time-consuming to harvest the tuffs of the tress when they're standing, the mother's first solution to have the trees cut down. As opposed to, oh I dunno, using a ladder.
This makes sense since it's the mother saying that they need to cut the trees down she hates the idea of waiting for her money and would never waste time working.
Why didn't O'Hare Air just wait for Ted to plant the seed and then douse it with a good dose of herbicide? Or, if he wanted to keep the tree as a source of oxygen, you'd think the company could just dig it up in the middle of the night and take it to some secret hiding spot.
Or better yet, just BUY it off of Ted. He's the richest man in town; Ted could name his price.
By that stage, Ted had heard the whole story from the Once-ler and reached a stage where he genuinely cared about the trees. He probably wouldn't have accepted an offer like that anyway.
Why would herbicide even exist in a town that hasn't even had a plant grow in 20 years?
Salt, chlorine bleach and human urine (due to nitrogen overload) are all pretty effective herbicides.
So O'Hare is interested in making more and more money from the citizens of Thneedville. But Thneedville is an enclosed community. So... how exactly can he get more and more money from them if, logically, they would have to run out of money sooner or later?
It's a fully enclosed society. Closer to a country than a simple town. Money gets produced by economic activity, so the more commerce, the more money there is to have. Finance isn't a zero-sum game.
So why the changed ending? Why end so optimistically rather than the bleak question mark? Well, to be frank, in the developed world, at least, the battle has already been won between the book and movie. America and Europe are gaining forest land and pollution of air and waterways is down significantly (heck, there is an abundance of fish in the Houston Ship Channel, Oil City itself). The issues aren't dumping anymore and are primarily old sites, sewage plants, and fertilizer runoff. Even big events like the Deepwater Horizon pale before the outright, consistent catastrophe that was the Gilded Age or 50s-70s.