Youth sports are definitely crazy nowadays. My boss is always doing something for her kids' softball activities.
Luckily, my wife and I are on the same page in that we'll encourage our kid (she's still an infant now) to always have 1 physical/extracurricular activity going on. No more, no less. What that activity is will ultimately be up to her. I guarantee you we'll have her try dance or ballet, only cause my wife did that. If she doesn't like that, then maybe we'll put her on a city-league soccer team. Who knows, she may end up wanting to play hockey (my pocketbook hopes not). On the flip side, she could despise physical activity and prefer music. But we both agree that trying to turn your kid into a mini-mi just makes the kid hate you down the line.
Either way, once the kid finds a niche, we'll encourage them to seek balance, but also push them just a little bit. "Do you want to spend all summer playing X sport, or would you rather take a break and go back to playing in the fall?" Or, "You committed to this travel swim team. I know you don't want to wake up at 4am for morning practice, but you made a commitment for a season and you're going to honor it, so get your butt out of bed." Hopefully we can convey the message of "there's more to life than whatever sport you're into, but if you really really want something, you're going to have to work for it."
We'll also reiterate that they get 1 activity at a time to keep everybody's sanity. It's not that we want to hold our kid back, but we both agree that having a kid go all in with music, sports, school, and family is simply too much for everyone involved. Yes, you can take guitar lessons, but let's wait for basketball season to be over.
Unrelated to my point, but related to previous posts in this thread, there are kids playing outside in my neighborhood every day. I know it's different in other places, but unstructured play is still alive and well in my hood, for all ages.