I have so many thoughts on this, and I'm glad you shared your rant. If Anduin was a leader in real life I'd vote for him, he's clearly a good candidate.

But he's not a good fit for leading the Alliance in our fictional Warcraft. I'd even argue that his leadership is actively bad for Warcraft lore. You say

Blizz wants an animated, theme-park-style war with no nuance or understanding. Which is just disappointing to me.

Every expansion we end up holding hands and beating the big bad guy, peace is restored blah blah and Anduin is the poster-boy for this cycle every expansion post-Cata. That's about as Disney-theme park style storytelling as we can imagine.

This is unsustainable storytelling because it requires the writers to come up with a new big bad guy every expansion like the Jailor (Who???) to continue this cycle of teaming up-- meaning we're basically just writing up new villains that have to be bigger and badder until we're literally facing the devil himself. In writing, this is called Spectacle Creep/Inflation.

You want this peaceful version of Warcraft but that's literally been every expansion apart from the first patch. No matter what tensions happen at the start everything always comes full circle and you have the peace of mind knowing that we'll all be friends again.

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I don't really see much that's interesting about factions committing atrocities and the Alliance being racists.

Here's why it's appealing: the Alliance and Horde aren't monoliths. They're made of diverse individual races with different needs and wants, and there's no reason why the Forsaken have the same goals as the Tauren or Night Elves. We work together out of necessity, not because we're all pals.

The faction war keeps the story grounded because the individual tensions between races in a faction war can be rooted in more grounded scenarios: food scarcity, land reclamation, racism, overpopulation, etc. It provides context to why Kalimdor and the Eastern Kingdoms are divided the way that they are, why Orgrimar needs to invade Ashenvale, why Blood Elves aren't welcome in the Alliance etc. You lose all that richness when you remove faction tensions because that's the entire context for why the human and physical geography of Azeroth exists.

TLDR; The faction war is a way of writing conflict into the story that doesn't have to involve writing anew bigger badder villain every expansion (ie. spectacle creep).