Some good points. I didn't know that you could blow up grenades on the ground. Definitely sounds like it could be OP. Maybe they could blow up, but have reduced radius or damage? But with how easy it is to craft grenades, seems like you could put down a few grenades every fight and easily create massive carnage.
AI definitely has an issue with blocking and sneak. The former should be relatively easy to fix I'd think. Seems like if there's no path to the player but there's a destructible object in the way, they could just attack it. Though would make for some funny ways for the enemy to kill themselves if you used oil barrels and whatnot. And some object have a lot of health. So ideally enemies would be able to throw objects out of the way, but that would take much more AI coding to get them to throw them in an intelligent way.
Sneaking is even harder to solve. How do you make it both an effective tool and something enemies can counter if abused? A sort of search behavior wouldn't be that hard I think, but then how is sneak useful? (I mean, it's already pretty useless in combat barring cheesing enemies since it's so prohibitively expensive AP wise, but let's say sneak is made to be good in a non-cheesy way.) Maybe enemies would only employ a search function (looking around, basically) if all players in the combat are sneaking. Otherwise the enemies will just focus on the visible players, which I think is fine.
I also agree fleeing is a touchy thing. I actually think Escapist is ridiculously strong since it lets you heal up and reset your cooldowns out of combat and then rejoin all refreshed. Even with just a need to be some distance a way, it's pretty easy for mages and rangers to flee. Generally combat isn't hard enough to warrant the time spent on it, but it basically takes advantage of turn-based combat with real time exploration in a weird way. What if enemies got some kind of stackable buff when a player flees? Like, boosted damage, movement speed, attributes, slight heal, etc. Basically they're tasting victory when they see a player run from a fight. Don't know if that would really counter any flee and heal over and over again tactic, but it's an idea.
Ultimately Larian isn't designing the game for hardcore players, even if a lot of people think that. They're primarily designing a fun game with a moderate amount of tactical depth. Which makes sense economically, since most people aren't hardcore players and just want a fun game. But it is nice when AI or cool tactics aren't so easy to exploit
BTW, if you're looking for a harder playthrough, check my signature.