In my career of product design (electronics, mechanical, production tooling and others), I have worked for large companies in the Automotive industry, medium sized companies in consumer products and a few start-ups. But in all of the companies that I have worked for the person who did the Industrial Design was the same person who did the Design Engineering and that is true for many companies. The reason behind this combining of the jobs was simple. By letting the Design Engineer perform the Industrial Design tasks, time and money was saved as it prevented the reviews of products that just couldn't or would be too expensive to manufacture. As a Design Engineer performing the duties of the ID the person will automatically note if a concept or design is not possible or too expensive as the DE already understands the manufacturing techniques that would be needed to manufacture the product and would therefore avoid designs that can't meet manufacturing assembly processes. The second advantage here is that you only have to pay one salary. I have always been a strong supporter of the idea that in order to be a good product designer (ID or DE) you really must have a solid understanding of a wide variety of manufacturing techniques. At Boeing all new "Engineers" must work on the production floor for specified period of time at all (or almost all), jobs on the production floor before they can finally sit at a workstation to design anything. As one of your reviewers stated, that is becoming more and more difficult as most companies are moving production "Off Shore".
My own personal belief is that the disciplines of the Industrial Designer and the Design Engineer should be amalgamated into ONE discipline to be taught at school. The result would be product design engineers that have more to offer than an ID or DE alone.