"classics" are those books which described the "human condition" of their times and, in a real way, still do. Human nature, as enlightened as we think we are, has not changed much over the span of time. Read the Bible and you'll find the same conditions in Genesis as we have today. Yes, we don't live in tents any longer, we have better sanitation, we eat a more wholesome diet (sometimes), etc., but the basic human natures described in the Bible still exist today, i.e. envy, pride, jealousy, greed, lust for power, etc. "Classic" literature does the same thing, and that, I think, is the appeal of these wonderful (if sometimes boring due to outmoded literary styles) books.
So-called "literary" works describe this "human condition" probably better than most, but usually do it to the exclusion of plot or story line.
That, to me, is the main difference between "literary" and "mainstream" novels, not the difference between "classic" and "literary." Both "literary" and "mainstream" can become "classics." Falkner and Hemingway, to me, are more literary, whereas Melville, Hawthorne (in spite of this thick prose), and Dickens, etc., are more mainstream, who's works have become "classics" in spite of the literary elite of their day. Both kinds of works can and often do describe the "human condition" in such a way as to appeal to readers, though, in my mind, the more mainstream the book is, the more popular it tends to become, especially if it captures the "human condition" accurately and sympathetically in a way that encourages change.
If you're interested in other opinions, you can read, and/or participate in, the rest of the discussion. Click on this link: http://www.authorsbydesign.com/AbDforums2/index.php?showtopic=4726
Hmm. I tried the link and couldn't get it to work. So, go to the Authors by Design web site that I have listed on my side bar. You'll find it under the LEISURE LOUNGE section.
Now, maybe you can use that as a link. I tried it and it worked. Oh well. I'll never understand computers and the Internet.