well, certainly presentation, reading water, etc. has a lot to do with it. But that stuff isn't reserved for fly guys, bait guys can read water and change presentation too. And yes, you can put every bit as much of action into bait as you do with artificials. We kind of chalked all that stuff up to the skill of the angler, and obviously a skilled fisherperson will outfish an unskilled fisherperson regardless of the tackle in their hands or offering at the end of the line.
yes, its condition based, I've never been more certain of anything in my life. Flies and fly gear are a major advantage, at times. Bait and spinning rods are a major advantage, at times. The proper discussion is to discuss the merits of each, as none are the ultimate tool for all places and times. And really, there are two separate questions here, bait vs. lures vs. flies, and spinning gear vs. fly gear vs. centerpinning.
Bait:
Advantages: The real thing is better than a fake, visual, smell, and taste. If you get a hit and miss him, they typically come back. They also hold onto it so all hits are noticed.
Disadvantages: You're generally limited to fewer food items. If the fish are keying on something other than what you've got, you're outta luck. Otherwise, you'll outfish everyone. The reason bait is advantageous for fresh stockies is that they generally aren't keyed in on anything at all. Longer period in the stream, wild fish, richer waters, frequent hatches, etc. all promote fish keying in on something.
Spinners, lures, and streamers:
Advantages: The major advantage here is the ability to cover water quickly. If the fish are aggressive, it can be very effective. Minnows succeed in the merits of both bait and spinners.
Disadvantages: You're pretty much limited to only large food items, especially baitfish but also crayfish, leeches, etc. Spinners and lures are not real and don't even look all that real, you're just hoping for reaction strikes, but they are flashier than anything else you can throw. Streamers can be drifted or worked, and look more realistic, but they don't have as much flash.
Flies:
Advantages: The ability to imitate ANY food item, big or small, at any point in the water column or on top of it, and with any action.
Disadvantage: They're not real. The real thing is always a better imitation than an imitation. And generally, when fish hit them, they spit them out, leading to a higher priority to be put on the strike detection and quickness of the angler.
Now gear:
Spinning:
Advantage: Can generally cast further. Easier to learn. Surrounding vegetation less of an issue. The flat mono line cuts water and allows you to get deep fast. It also has superior ability to feel bites and bottom.
Disadvantage: You need added weight in order to cast that distance. Unless a bobber is employed, that means you have to keep a tight line to prevent a nearly immediate snag, negating the drag free drift. It also means its difficult to fish the top half of the water column at any reasonable distance.
Fly Gear:
Advantage: The weight is in the line. It means you can use smaller items with no weight, even at a distance. Which means you can let the line go slack without worrying too much about snagging, allowing a drag free drift. The fact that the line typically floats also enables topwater fishing at a distance.
Disadvantage: read the advantage list for spinning gear, these are the disadvantages of fly gear.
Centerpinning:
Advantage: The ultimate drag free drift machine.
Disadvantage: Rather limited in being able to vary presentation. Requires weight.