I just got done spending the weekend at Demicon, the Des Moines area's annual SF/fantasy convention. It was a lot of fun; I got to see quite a few people I normally don't get to see as much as I'd like to, attended some very interesting panels, and had a good time overall.
As you might expect, the subject of the Puppy Wars over the Hugos came up. Most of the people I hang with are pro-Puppy; my friends tend libertarian-to-conservative, and are not too fond of "Social Justice Warriors." However, I came to some conclusions that may be a bit unorthodox.
Firstly, traditional SF/fantasy fandom is no longer all there is to fandom. Worldcon is somewhere between 6000 and 8000 people, while Dragon-Con in Atlanta and Comic-Con in San Diego are much, much larger. The big commercially-run media cons are overshadowing the traditional volunteer-run conventions.
Secondly, traditional fandom has ossified in some ways. Just for starters, there's a Hugo for "Best Fanzine." Fanzines were something I very seldom if ever saw in real life, even back when I was starting out in fandom in the mid-1980s. Nowadays, with the Internet, they've become all but obsolete. The short-fiction scene is nearly moribund as well; back when, the magazines were where you could find most SF, but nowadays they're a sideshow and may not last another decade.
As for what to do...either just declare the Hugos to be the Worldcon award, and quit trying to say that Worldcon speaks or can speak for all of fandom, or open up the gates. Maybe make attendance at things like Dragon-Con or Comics-Con good for half price on a supporting Worldcon membership, and ramp up publicity for voting on the Hugos.