While diglossia as a field of research or even the concept might have flowered long past Caldwell, its quite inconceivable that Caldwell would have been unaware of this diglossia.  Infact, in speaking about the difficulty that the untrained or sometimes even the trained Tamil(and I certainly and strongly feel that he is talking about people who have received their training in Tamil Nadu.  I dont think he would have based his views or book on somebody who learnt or spoke Tamil in say, Germany or France in the mid 19th century) faces, Caldwell is speaking about nothing but diglossia, maybe without putting it down in as many words.

Be that as it may, what studies in diglossia in Tamil over the last several decades would have done is merely deal with the 'problem' in greater detail and throw light on such things as the causes for diglossia, 'evolution', perpetuation etc., of this phenomenon over the centuries and other things of academic interest like that.

What I am trying to say is, while scientific interest and research into diglossia might be a development of the last few decades, 'diglossia'(in tamil) existed nonetheless, even before that.  And like I said, Caldwell has only touched upon it though not gone deeper into it to research the more intricate details of it.

Notwithstanding that, the fact remains that the ordinary Tamil, especially one without formal(or informal) training, is often at a loss to understand Classical tamil enough to fully appreciate its beauty.

so, imo, the lines that are already there should be retained as it is.  But, you should also(before those lines, preferably) make a mention of the diglossia that exists in Tamil, the different levels, the continuum etc., and then conclude that... "....as a result of the said diglossia, the ordinary Tamil, sometimes even with formal training, is at a loss to understand the language of classical literature(or the other diglossic levels)"

And, to answer Sundar's question as to whether (I feel) this is limited to just Tamil or is also a feature of other languages -

While I dont a 'professional grade' knowledge of any language, I've had formal schooling in both Kannada and Hindi.  And I've observed this feature in both languages, much more so in Kannada.  In Kannada, in fact, if you were to study the 'Mankutimmana Kagga'(written sometime in the 60s or 70s i guess) by D V Gundappa, the language used is somewhat in haLegannaDa style, though I would say, it doesnt 'sound' as haLe(old) as haLegannada.  I am able to understand this work for the most part except in some places where it gets a little too much for me and I might have to refer to the dictionary.

Any literature, regardless of when it was written, but written in pure haLegannada style, I would say, wouldnt make much sense to the untrained eye or ear.  

With Hindi, probably because the language is much younger than Kannada or Tamil, though I've observed a sort of diglossia, say in the language that Kabir employs, verses that of Munshi or someone,  Kabir is far more discernable to me than say the Kavirajamarga would be to me or probably Kural to you.

In general, I feel some degree of diglossia almost always exists in most languages(atleast Indian languages) in that, the lingo employed by news readers, say,(atleast in the good old 'Doordarshan only' days), is removed from the one you would hear on the street.  Talking of newsreaders and the lingo on street, I just remembered an interesting thing about the Kannada spoken by the people of South Kanara.  It is almost exactly like the one employed in the news or in formal documents, in that, they speak much the same way they and the rest of Karnataka would write.  I am not sure if there's a parallel to this in Tamil or any other language that I have any knowledge of.