I thought the film was okay - saw it late (though not as late as you!) and never got around to writing about it. Leo DiCaprio was excellent. The problem is that Tobey Maguire was God-awful. And since the story is really Carraway's, not Gatsby's, having a limp Nick kills the story.
Nick needs to be a cool guy, quiet but good-looking, somebody to whom rich people want to reveal their secrets. Nick should have melancholy depths, but he also needs to be subtly charismatic. Otherwise, the plot makes even less sense. E.g., Tom Buchanan, Nick's cousin-in-law, instantly takes Nick along to meet his mistress with whom he's cheating on Nick's cousin Daisy. You can make up various explanations of Tom's motivation for this imprudent behavior, but the most plausible is that Tom just wants to be around Nick and to show off to his lady friend that Nick is his protege. (Thus, while Gatsby has ulterior motives for hanging around with Nick, he also always seems to really like Nick).
In other words, Nick should be both F. Scott Fitzgerald's self-pitying self-image of F. Scott Fitzgerald, combined with the real life F. Scott Fitzgerald, who was a big celebrity years before he wrote The Great Gatsby at age 30. There are no shortage of handsome, personable young actors in Hollywood who can play that role. You can order them up by the boatload in London. By the standards of movie stars, however, Tobey Maguire isn't one of them.
The 1974 film had Sam Waterston (Law & Order) as Nick. Waterston at least had some air of distinction about him, even if he always looked a little not quite right in the head (as if he not only looked a little bit like Abraham Lincoln, but also, deep down, believed he really was Abraham Lincoln). But Tobey Maguire mostly seems dorky and mundane, which served him well in Spider-Man, but not here.
I understand what Luhrmann has been trying to do since Moulin Rouge, but it isn't working for me. It isn't that I object to melodrama as a key component of fine art, and it certainly isn't that I object to conscious artifice. But I find his style hyperactive and his characterization shallow. When Vivien Leigh raises her fist to the sky and says, "I'll never go hungry again," she's insanely larger than life, whereas Luhrmann's characters too often wind up seeming like wind-up dolls. That's certainly how I felt about Nicole Kidman; I never believed in her for an instant. Daisy Buchanan, of course, is supposed to be shallow - but I couldn't tell if Luhrmann understood that, or if he thought she was just dandy.
Luhrmann says he's influenced by Bollywood films' relationships with their unsophisticated audiences. So, what would a Bollywood audience think? Daisy is fair and rich. What's not to like?
As for Carey Mulligan as Daisy, she's fine. She's one of this new breed of refined British stars, like her rock star husband Malcolm Mumford. But she's not quite beautiful enough for a legendary role. She came to fame in An Education for her amazing ability to make tiny muscles in her face flutter -- she's like a very feminine Jim Carrey. But, Luhrmann doesn't have her do much of that here. In repose, her face isn't quite lovely enough. But, it's not a major defect in the movie, just a missed opportunity.
Finally, I like your suggestion of how to frame a film adaptation. Are you familiar with the Elevator Repair Service (a theatrical group) and their production, Gatz? It's a stage version of The Great Gatsby, but it's not exactly an adaptation. Rather, the play is set in an exceptionally depressing basement office of some dreary small business. Everyone's starting off their depressing day, when one employee, whose computer won't start, picks up a copy of The Great Gatsby. And starts to read. And, thereby, to take on the role of Nick Carraway - and one by one, the other employees get in on the act, taking on roles from the book and acting out scenes - but never leaving the world of the office, never putting on costumes or anything like that. And they read the entire book. It takes 8 hours, with intermissions, and it's fantastic. I got the impression that they were aiming for something similar to what you were thinking about with your frame story: what does a story like this mean to the people who read it and loved it, the normal people, not the academic students of literature (nor the bored high-school kids who are forced to read it).
Anyway, I liked ERS's version a lot better than Luhrmann's.
Sometimes when I go for a walk in the park after dark, I run into this troupe of amateur actors in their early 20s who use the open air near the playground to rehearse Shakespeare plays. They'll be saying "doth" to each other and sword-fighting at 3/4ths speed to get ready for their shows. Obviously, they've got zero money if a dimly lit outdoor playground is their best option for rehearsal space.
But, from the perspective of cultural continuity, how great is it that young people are still coming together voluntarily like this to put on Shakespeare plays after 400 years?