Gerrard has been in decline since the 2008-2009 season. It's sad to see, but there's no use deluding ourselves. It's perfectly understandable - players get older, their physical abilities diminish. The fact that he's still in our first XI says more about the paucity of talent in our squad than his ability. I'm not sure what he's done to justify his place this season other than being less crap than Shelvey or Henderson.
The things that worry me the most about Gerrard are two-fold. First, his work-rate is frankly pathetic. A lot of his effectiveness was derived from the fact that he seemed to be everywhere at once. A true box-to-box player, that could get back and defend, get stuck into a tackle, spray a 40-yard pass forward, then arrive in the box to score from a cross. I haven't seen him really put a shift in for a long time.
Second, he hasn't shown signs that he's able to adapt his game to compensate for his physical limitations. When Giggs lost his pace, he re-tooled himself as a decent central midfielder. Gerrard needs to realize that his role in the team is going to have to change - probably to a sort of "quarter-back" type position where he can just sit back, ping some passes about, and keep possession.
Gerrard has been my favorite player for years now, so it's really tough to see him like this. It's going to be tough, if not impossible, to replace him, but that's what we need to start thinking about.
Although his pace has dropped, his workrate hasn't. He seemed to be everywhere at once because everyone was doing their job, and he was free to go where he wanted to impact. With Xabi and Masch or Lucas and Miereles on the pitch, he had freedom to just follow the ball and do whatever he wanted with it. The problem now is that he's baby sitting Spearing or Adam or Whoever is playing deep, covering a specific zone (that is not his responsibility) rather that going to the ball and causing the chaos he usually does.
When his CM partners do their job worth a damn, we see he still has the quality. Look at the Norwich and Everton games or the first Man United game. He didn't have to shore up the center himself, so he roams where he likes, either to add an extra dimension to the passing in the center (instead of trying to save it himself) or to slot in behind the strikers. When the happens, he scores hat tricks, creates assists, and makes everyone on the team (particularly Suarez and Carroll) look better.
Gerrard is a game changer, a match-winner, and sometimes a match savior. But he is not a skeleton to build a midfield around; he's a catalyst. He complements the jobs and talents of other players and make them more efficient, he doesn't do all of them himself. That's why he was so instrumental in getting the best out Torress, and that's why the Suarez Carroll partnership looks better with him in the team. That's why he seemed to be everywhere at once.
That said, I agree, he needs to groom a replacement soon, and he (and that replacement) need a midfield to play around him.