This may have to do with your major - something computer science, isn't it? I can assure you that in the humanities you most certainly need the libraries - whenever you have to write a paper, a project, etc. And I'd think it's rather hard to write a master's thesis in any major without library books, or at least printed scientific magazines. Many scientific magazines have put their archives on sites like JSTOR, but not remotely all.

That's for the actual work itself; personally I've also used my university library for reading about things that weren't in the curriculum but that I found interesting. I guess that's a matter of preference.

You're probably right that looking towards the future, more space will be needed in libraries for sitting and working at computers, or group works, and less for physical books. Libraries may find it's a better use of space to put many of the less important books in their stacks or depots, from where they can still be fetched when needed. But selling them on a large scale? That's not a good idea.

High school libraries certainly could. College ones, not so much.