Interesting that only Act 1 received extensive testing. That is quite apparent in retrospect.
I sympathize with Larian regarding AI issues. AI in games isn't close to where people expected it to be two decades ago, and with the variety of status and terrain effects in Original Sin, the combat AI has to be significantly more complex than that of most tactical RPGs just to function at all. Making a complex AI actually good at the game? That's even harder. The AI is most clever in the very first turns of a battle where the scripted opening salvo plays out. You're right that lacking AI would be less apparent with fewer battles to figure it out. I'm just not sure if an improved AI would have made that much difference to my experience, though the added difficulty certainly wouldn't have hurt.
I'm probably more extreme than most in my response to late-game tedium considering I didn't just tough it out and soldier on until the end like many (most? Impossible to measure). I can't help but wonder, though, if the Enhanced Edition couldn't have offered a Consolidated Combat option featuring fewer encounters. It offers an easy mode for people who want to breeze through combat to focus on exploration and the story. What about people who want to be challenged without having to spend 85% of their time in often redundant combat? I truly don't think it would have been too time-consuming to implement:
1. Cut out many redundant, lesser encounters that are irrelevant to the story.
2. Scale up kill experience in proportion to the amount of experience deducted via the excised encounters.
3. Scale up enemy loot drops to make up for fewer encounters.
4. Move notes or diaries or keys from excised encounters to significant encounters, corpses, chests, etc.
Larian was aware of the widespread belief that the game dragged and they sought to fix that in the EE. I understand that cutting dozens of hours out of your game via an upgrade is a serious sin that fans would have gone nuts over, but in a vacuum, might relative brevity have resulted in a more uniformly enjoyable experience? I'd rather lament a game wasn't longer than be relieved I finally beat it. I suppose any consolidation is up to modders like you at this point.