The thing is, everything else about LH is an improvement, but the lack of random level-ups could easily end up making the hero game less fun, and will result in generic heroes for the most part (I can see exceptions)
I still think it's too early to tell, but if the concept got scrapped I'd be ok with it, after some time to see if it does work.
I really don't want to feel like i have to choose between two different games where each one has something I'm dissatisfied with, or hope someone mods the LH content into FE.
The non-random traits also make heroes slightly less powerful in general, because you can't get those great traits early. This may be more of an issue with the trees themselves (balancing issue) and less the idea itself. It takes too many levels to get to the fun stuff.
Gotta remember this is beta 1, the devs haven't seen the issues yet, we come up with ideas they don't. I do think the hero game is going to end up less fun at the current rate, but I don't want to abandon the idea just yet. (also no idea how much it would cost to revert if it proves unfun)
Trying to be diplomatic about things, but I agree with the OP. My big fear right now is that we end up with a game that is a 90% upgrade,but the 10% downgrade turns me off of both games. (As a fan of the King of Fighters series, I've seen this happen to me)
Right now I feel pretty strongly that the dev team needs to at least keep under consideration scrapping this idea, even if it's one of the big changes.