The Silph Road has done quite a bit of research into spawning mechanisms and their findings have been corroborated by much of the community. It isn't necessarily guaranteed to be 100% accurate but the evidence supporting it is overwhelming. In either case, all their work is reproducible and peer-reviewed so it's largely considered to be the most accurate non-official information available.
From what I understand of their findings, the world map is littered with "spawn points" (marked by the rustling grass animations), which spawn one pokemon at regular intervals. Most spawn points trigger once per hour but I've heard of some spawning as often as every half hour (although it is possible that the location simply has two spawn points very close together). A pokemon spawned in this way lasts for 15 minutes before despawning and will be available to any player who is in range during that time. Every spawn location has different timings so one might trigger at :02 past the hour and another might trigger at :29.
I have not yet seen any evidence to suggest that these points may cease spawning at any time for any reason. We do know that they are tied to locations that historically have increased mobile data usage, which is why there are tons in the downtowns of larger cities but very few, if any, out in the country.
Assuming this is all correct, it is theoretically possible to momentarily deplete an area of pokemon by catching everything that is currently spawned but that will only affect you and will only last until the next spawn point triggers.
If I were to speculate, I would say that the "dry area" effect is a description of the 45 minutes per hour that there are no pokemon at a given spawn point. If your area only has one or two spawn points within radar range (especially if they all trigger at roughly the same time), the effect would be highly visible, which is likely what that other user was seeing. I don't know whether the map turning grey is related to this but I would suspect it isn't. Instead, I would chalk that up to a graphical glitch but I don't know that for certain.
The issue you're seeing may be related to the wobbly condition of the servers at the minute. Niantic have tweeted (on the Pokemon Go News account) that they advise against using valuable consumables (lucky eggs, incense etc) before the servers are stable.
My advice would be to not use incense while you have the spinning white "loading" pokeball symbol on the top left hand part of your screen. If this wasn't the case when you used it and the issue persists then it might be a separate issue that I'm unaware of.
As a temporary work-around, try heading somewhere busy. I read somewhere that pokemon are more common in densely populated areas like city centres, though I haven't tested this yet. My personal experience is that I'm more likely to find pokemon near water and playing the app while on the train usually results in an encounter every other station or so.
Edit: Ok, pokemon are almost certainly more common in busier places. I rode a bus 20 minutes from the town centre to a suburb and the encounter rate dropped the further out I got.
Best Answer
The hearts floating around a Pokéstop signify that someone has deployed a lure module there. Therefore more Pokémon will be attracted there until the lure wears off.
There are also glacial, magnetic, and mossy lures which attract water/ice, electric/steel/rock, and bug/grass/poison Pokémon respectively. They can also be used to evolve certain Pokémon into their type specific evolutions. See here for more details.