I agree with you. Level scaling is the method chosen to balance the game. It worked too well! In fact, many people hate those systems because they feel so static. Personally, I could not play Oblivion. I tried numerous times and just got bored because I realized their was next to no unique encounters or loot to be found.
A better system is to design the balance in waves, spreading outward from the location characters start in. Hand place all of the balance, including enemies too powerful to defeat at the end of dungeons(for new chars), and ultimately the game will be better for it. Previous TES titles used scaling, and Bethesda truly did enhance scaling. However, the scaling should have been scrapped long ago, kind of similar to the scrapping of stats. It was bad design WAAAY back then, just like it is bad design now. It will turn off an intelligent player who can see the underlying structure of the gameplay. They will realize how the game unfolds within an hour or two and not want to play(like I did with Oblivion).
I totally agree. Balance is Over rated. However, don't be afraid to have next to impossible encounters with amazing rewards. This is something TES has NEVER done right.