I agree with OP, the setups have become a burden.
I'm not a fast driver by no means, but it still frustrates me to know that the drivers that beat me by seconds are probably using unrealistic setups. Not to mention things like wheel / chase view, clutch cheat.. but i digress.
I don't see why we don't have server determined setups OPTION. People who enjoy fiddling with setups would not lose anything, and those of us that enjoy an even field could have a place to race.
I understand unlimited setup tweaking may be benefical to testing the physics engine. Why not keep single player as it is, but limit setup options in multiplayer. Win - win?
Limiting setups is the easiest way to enhance the racing experience, ironing out all the bugs from physics will take time.
When I was introduced to LFS i was impressed by the flexibility of setup options. This however should not stand in the way of enjoying LFS. I have a feeling more and more "serious" sim-racers are switching to iRacing..