I think you're assuming that he/she is the total and complete creative head of the picture, when in fact, many of them are not. What if a film had great direction, but a terrible soundtrack? What if a film had great direction, but terrible set design or art direction? I agree with you that it is difficult to separate the two, but I think you still can.
>What if a film had great direction, but a terrible soundtrack?
>What if a film had great direction, but terrible set design or art direction? Then the film didn't have great direction. It's impossible to seperate the two. Every director works differently, but the entire film is the director's responsibility. He's the one big picture person on the project. In the late 20s when the academy was invented, through, the producer was the creative head of the picture, and the director's award made more sense.
I'm not in the industry. I don't fully understand the academy. However, I think I understand it well enough to know that while directors may have creative control, it is not absolute. Producers and Executive Producers overrule them on stuff all the time. Things that directors want, end up on the floor. Look up Alan Smithee. As I understand it - very few directors are given complete artistic control.