More importantly, you're discouraged from using casters because the 5e racial imbalance is horrendous
This is so true. Wyll and Gale being standard humans really cripples them, especially given Larian's encounter design. However, I think your analysis of the problems with casters is really just an analysis of the problems with Wyll and Gale. For example, maintaining concentration on a Wood Elf Light Domain Cleric is not difficult. A Shield Dwarf Wizard has high armor class, darkvision, and good constitution for HP and concentration saves. And their are some invaluable spells in the game. Sleep, Hold Person, Pass Without Trace, etc, that make casters extremely valuable. Its not a serious problem for Sleep that you have to do damage to get them below a certain HP threshold before it will work. It still guarantees crits, removes an enemy turn, and has no saving throw. Its an insane control spell. Healing Word is another great example.
