This is an interesting write up and I hadn't really realized their was going to be an inflation bomb problem. I never did like the fact that the max amount of ETH was never designed and they just make various changes and like you said it is like this production testnet situation.
The fees were joke status this last bull run so it was really hard to be bullish on the capabilities of ETH but I would say the main advancement that all this brought was being able to tokenize assets on these chains and then be able to borrow against those assets on these money markets. Also I do like the premise of these exchanges like Pancake Swap or BiSwap which are both on the Binance Smart Chain. It just exponentially explodes the amount of possible money making strategies.
Being able to take a loan against these assets is so huge to me.
I am not convinced of it really, these protocols like pancake swap and all that are cool ideas, but they have a lot of privacy issues, so what's the point of a dex when you're doxing so much meta data on chain? The idea of a dex is also to preserve privacy
As for taking a loan against collateral that is shoddy at best I see it as a recipe for disaster, even with bitcoin I wouldn't take a loan of more than 10% LTV