What I don't understand is why most, if not all, concepts like this I've ever seen involve a weakening of magick. Seems like it would be interesting to see what direction "technology" would take if it were intertwined with magic all through its development.
A suggestion: Get some long-time players together with FR and general 3.0 or 3.5 sourcebooks and copies of How Things Work, and let them munchkin the heck out of innovating whatever they want using their own current knowledge AND what they think 20th level characters would know, and then use THAT for the basis of your technology. And don't let magick die. There's already too many games like that, IMHO.
(Some of the guys I used to game with had come up with working cars and even a type of helicopter based on munchkining the heck out of the Frisky Chest spell under 2nd Edition rules. Think of the possibilities!)
As to why a lot of people aren't digging the "U.S. of the Sword Coast" thing, I can't speak for them, but to me it sounds too "parallel Earthy", plus the nation that would arise out of the Sword Coast seems to me like it would bear more resemblance to England or maybe even France or Spain than the U.S. A powerful Lord's Alliance that eventually ends up somewhat deferential to a Representation of the Commoners, and you pretty much have the recipe for Great Britain.
Remember, the map you see of Faerun in the FR book is equivalent to a map of Eurasia and Africa - there's probably a whole other hemisphere lurking around somewhere, and that seems a more logical place to develop any sort of U.S. analog, if you're going to have one.