The damage reduction is minimal. The bonus action cost is also minimal. The 300 foot sound can be intimidating. I mean a smite that loud could cause a mass surrender all by itself. And number 4 isn't much of a vulnerability since you have normal smites for when you are fighting spellcasters who can use them. You get to choose when to use the spell and when to use normal smite. It's only a full liability if you can ONLY cast spells, because then you have no choice but to be vulnerable to all of those anti-spell abilities.
Interesting, the bonus action cost of the ability is minimal. So changing Divine Smite to a bonus action should be equally minimal.
I like your attempt at spinning the thunder, it doesn't work, because no one is going to have a single 1st level spell cause a mass surrender, but it was funny to read.
And the point 4 is such a massive downside that the only thing you can think of is having it not be a factor. Because I asked what balanced this, and your response was the balance was achieved by having an option that did not have this negative. Nothing in the ability itself balances this, only the option to use a different ability to avoid this negative.
So from this, your ideal balance would be to have all of the smites, Divine and otherwise, be bonus actions on a hit, and they should not be spells.
Take out the bolded and that's exactly what happens. They swing, they connect, they do damage and then they take an action(bonus actions are still actions) to cast a spell after the hit and damage to add to the damage of the original swing as it hits.
If you take out the bolded part, the sword is still buried in the enemy. In which case, it's kind of obvious what they are attempting to cast. Not many misty steps are channeled through a sword.
Sure. AFTER it's too late to counter. BEFORE it's too late to counter, the caster won't know whether it's smite, misty step or divine word that is being used as the bonus action.
Self-imposed limitation. There is no reason they can't recognize it in time for the counter. After all, they would recognize shield being cast as a reaction to a weapon being swung. They know the trigger was "targeted by an attack" and that narrows it down. The wizard watching this fight can see the trigger was "hits with an attack" and can narrow down the spell that is being used.
And keep reading.
You've completely missed the point. The caster doesn't know whether it's a paladin, cleric or religious fighter that's swinging the sword. Nor does the enemy feel the invisible paladin auras. We know that they are not visible, because in 5e it needs to be explicitly said for it to be present. It doesn't say the auras are visible, so they are not. Nor is the weapon glowing with any sort of glowing or divine energy from paladin abilities. Carrying divine power within the strikes does not mean visible. It doesn't say visible, so it isn't. Further, even if they were visible, it would more commonly be from a magic weapon than from a high level paladin ability.
So the enemy can't tell a paladin from a religious fighter because you say so. Because you say there is no possible way for them to know an aura is present. Because you say that the Radiant Strikes are not visible. Because you say it can't be done.
Well, I say it can.
And, again, lets say you are right. Let's say that the mage has no clue what you are and what you are doing, just MAGIC! like a dog orienting on a squirrel, and they blast you with a 7th level counterspell because you might possibly have been trying to cast Divine Word and that scared them. Yes, you lose a 1st or 2nd level spell slot. They lost a 7th. Explain to me how this is a bad trade?