Yes, it can be frustrating and unfulfilling especially since the rest of the gamne is so excellant, my latest party is 10th level, getting ready to meet Braccus and no one has any really good items.

At the very least every boss should drop a legendary item, and the merchants should all at least stock some legendaries.

I know combining items sounds kind of monty-haul but really hacks me off when you have 2 mediocre items and need just one good one.

Linio, I feel the pain, I also am really sick of telekinesis and +10% resist earth rings, ( as Stabbey said ( very corrrectly) nothing uses Earth based damage, or very little does and generally elemental resistances are the least useful of item abilities).

Not sure if we are beating a dead horse or even if they would want ot improve it, maybe this si the games biggest non-technical weak point, hey even Baldurs Gate(s) had some things in it I didnt like
and I think most of the items in IWD were very generic and ho-hum. No vorpal swords? oh wait there is a vorpal sword its the Githyanki silversword which is sucktacular for its attack speed if I remember right....why penalize the player, the company got my money, gaming should be rewarding and fun. I think Larian could fix it and didnt break it intentionally, its just meh and really unrewarding in final execution/operation.

Now on my last playthrough I did find the best item I have ever found, so far.

Legendary Claymore 2handed sword.
+13 crit chance
+1 to STR, CON, SPD, Dex, ( and I threw a Tormented soul on it immediately)
probably had some other ability or 2 I forgot, but since I found it at 12th level I gave it up around level 15 because it no longer could do competitive damage and couldnt be upgraded! that really hurt if I could have upgraded the damaqe more, I would have used that until the end of the game!