Our argument is and has always been that many "fundamental parts of [fantasy] magic" are in fact broken as all hell. They so dramatically limit the stories you can tell, the settings in which you can adventure, and the characters you can build that they really need to be reined in.
I can see your logic and agree with it most times. However I think it's possible to take thinks too far the other way. This isn't necessarily a problem of Polymorph itself (being a "anything goes" spell") but a question of if there shouldn't be some kinds of lesser or more-limited spells that allow for some kinds of fantasy-inspired transformations.
The simplest alt is to have a version of Disguise Self (perhaps a Spell Level 2 "Disguise Self II") that bypasses Species and Size restrictions on Disguise (the same way the Fire Brave ability does). (Or just changes the "Impossible" line to "-20", I don't know.) Spellcasters can change into all the forms them want, but it doesn't change their statistics at all.
Then have some minor spells like Wild Side that grant other bonuses: "Form of the Stalker" would grant a four-footed animal appearance, improved sense (smell)
, a +5 gear bonus on Survival checks made to follow tracks by scent, and maybe darkvision I
. Just simple, flavorful spells that don't grant powerful bonuses but let players have their characters change into animals.
I expect this approach won't change for Fantasy Craft, though there are perhaps a few cases in which the game balance could be achieved differently. I'm reading, and will continue to consider leading up to my final run.
I can't ask any more of you.