Let me go point-by-point (speaking of which, GT6 could use some more proper point-to-point races).
*snip*
Excellent post, John 👍
I'm always torn about the idea of making GT more linearly, series-focused too. I think my favourite GT Mode out of the series was probably GT2. For those who didn't play it (I'm positive John's familar): there was a large variety of races, with certain limitations on the cars allowed in the series, as well as an HP cap, though only focusing on HP meant the flyweights could dominate. I do think separating series into different halls/leagues is a good idea, and despite others' dislike of the system, think basing the entry requirements on the racing licenses is something that made GT unique. Personally, I loved starting the license tests first; it gave you an intro into the game, usually with hints of new cars and tracks.
Anywho, provided the PP system were overhauled with the aim of increasing the balance, I think a PP cap on series, with additional limitations on things like aspiration, country, body type, etc etc, as the series dictates, would make for a far more fun, more open approach to GT5's awful XP progression system. I like that back in the older games, I could forge my own path through the career mode, focusing on the series I wanted to race. The GT300 series in GT2 was one of the most fun I've ever done; more of that, PD!
Also, in regards to flags; I hate to bring up Forza, but I think including flags should be handled in a similar way to how that series uses aids or AI difficulty; allow the users to set them to their personal preferences before each race, but award them additional credits/XP/whatever based on the increased difficulty they choose. If I turn flags on, perhaps I should get 25% more credits? While I'm on that subject though, I'd prefer the GT Mode to not allow users to really fiddle with difficulty of the AI. I'm an advocate for giving people access to all cars, at least stock, in Arcade Mode, and I absolutely believe that mode should allow as much freedom with the settings as possible, but GT Mode should have a level of progression and difficulty that's standard across the board for players. I don't think absolutely everyone should be able to achieve 100%; I'm not a fan of that "everyone's special" entitlement philosophy. There are some games from years ago I could never beat entirely, but I'd never want the game to be intentionally dumbed down to let me do it: where's the sense of accomplishment?
Ramble over!