Whe you put it that way, I'm tempted to say the question is ill-formed.
A genre is a category of a particular media, art, or cultural element. So, there's jazz music, fantasy literature, and Tex-Mex food. The art-form is often implied, but it must be present. That's because a genre is defined by qualities and themes of the works within the genre. Consider: there's modern Japanese food, and modern Japanese architecture - both reasonable genres. But they have no reasonable overlap in their expression, being completely disparate media - they couldn't share aspects of their execution*. There is no "modern Japanese" genre that encapsulates both.
So, there's fantasy image-art, fantasy literature, fantasy computer games, and fantasy movies, but I'd question if there's an overall "fantasy genre" that encapsulates them all.
IMHO, anyway.
But, that being said, define what qualifies as "being mainstream", and maybe we can tell you something useful anyway. It seems to me that pretty much everyone born in the US knows what a dragon is, what a fairy is, and what witches, ghosts, wizards, unicorns, vampires and werewolves are - those are all elements of fantasy genres. We've been inundated with Disney's versions of various fairytales for decades, everyone knows of King Arthur and Merlin.
So, if that's what you mean, then yes, fantasy is mainstream. It has been mainstream for longer than "literature" has existed as we know it today, honestly. D&D doesn't have much to do with it.
*Unless you're building a structure out of food, I suppose.