Local radio stations in small towns are completely (but sloppily) automated.
Most are not sloppy. Give examples if you are going to indict the whole industry.
Most local broadcasters use Winamp or some questionable software for their automation.
Actually, they use rather sophisticated radio-specific software that integrates the commercial log and the music log.
They don't even bother to set crossfading correctly:
That all depends, in most cases, on the program source provider which is generally a national service that provides specific formats to station all over the US.
They either have TONS of dead air or a commercial/jingle gets crossfaded mid-sentence.
Stations that do that are likely in dire straits and can't afford to do the quality of production required. More than half of all US radio stations were losing money ten years ago. It is worse now.
I won't even comment on the audio processing: some stations have audio processors but set them up poorly, while others only use dubious limiters/clippers that cause severe distortion.
All stations use broadcast quality audio processing, whether software or hardware based. Perhaps the station you are referring to sets it in a manner they like but which you don't!
Kudos to the very few stations that still keep radio live and local - I really appreciate them!
Some of the biggest and most popular music radio shows are neither live nor local, starting with Ryan Seacrest. Those shows are assembled from workparts created in the 20 hours prior to broadcast because that allows them to get artist interviews, features and other at the convenience of the outside source.
The only reason radio was "live and local" from the 50's through the next 4 decades or so was that technology was not advanced enough to do what we would have done back then if we could have. Add in the lack of the Internet and the cost of AT&T landlines in that era and doing networked music shows was nearly impossible.
Remember, in the first three decades of radio, nearly all programming was done from a network studio in LA, SF, Chicago, Detroit or New York. Stations were only "local" in off hours when few people listened.
And most of us would rather that a music station have Bobby Bones or Seacreast of Charlemagne da God or the likes because they have immediate access to people I want to hear... and not the local mayor or dog catcher.