To be clear, when I say returning players I do not mean players of 3.5 or 4 that still play and know all the rules. To me those are more like transitioning players, transitioning from recent editions to 5e.
That's clear, yes. I'd consider a returning player anyone who's been away from the game for a number of years. If I had to take a guess at the mode-average/representative 'returning' player, I'd say returning to the hobby after having last played AD&D prior to 2000, if only because the fad years were in the 80s.
And, BTW, there are folks who have been playing 2e AD&D or earlier /all this time/, and are 'transitioning' from that to 5e.
When I say returning players I am more referring to the people that played 1e/2e 20 years ago
So prettymuch on the same page.
There is a stark difference between that type of returning player and the player that is transitioning from other editions.
They're less hung up on minor differences, for instance.

But while it's a clear difference, I don't agree it's stark. Their general expectation of what D&D is will be similar.
Those type of returning players are much more like new players.
I can't agree. I've run games for both sorts in the past. Even if they don't remember a lot of the details of the rules from their time playing D&D, they remember the some of the classes, have expectations about what they're like, have already come to terms with D&Dims, not just mechanics, but conventions that stray far from the genre.
New players still have to go through that whole acclimatization process.
So the base game is built is such a way as to be easy accessible to those players. It's fairly simple and easy to jump into.
For returning players, sure, it can be. They're not puzzling over the very concept of roleplaying, they know what classes are (and to start with the fighter, 'cause it'll be simpler), they know that they'll be exploring dungeons, watching out for traps, fighting monsters, collecting treasure, etc...
That sounds obvious because it is once you've done it. Even 20 years later.
The transitioning player is generally more versed in the rules of recent editions and they study the rules for 5e, they optimize and play at a much higher level.
Well, maybe - not every long-time D&Der is an optimizer or considers 'skilled play' the object of the game. What they will tend to do is skim through and note how the new ed is different from the old. They look for the differences among the similarities. 5e works fine for that.
Returning players look for familiar things (that they do remember or that trigger memory) as a starting point, and fill in the blanks, they may or may not note which bits are new or different. 5e, with it's emphasis on classic feel, is just about ideal for them.
New players don't do either. They have to take in the whole thing. 5e's not so conducive to that. It's very complex and inconsistent, since it's had to retain enough similarity to multiple past editions to make returning and transitioning players comfortable.
So they made the base game how they did to pull those folks back in and at the same time they gave the transitioning players the tools to tweak and fiddle and mold the game to their playstyle.
The target audience for 5e is clearly existing and returning fans of the game, yes.
The entire argument at this point seems to be a vocal group that wants the game built for their play-style
The game is built to Empower the DM to impose the playstyle he wants. The whole sorta 'modular' (not the word I'd've used, but oh well) design approach, with many different optional pieces, supports that.
But, it's most practical to get to the desired style by opting into modules or banning things you don't care for. Modding is harder, but experienced DMs, even (especially!) returning ones, are probably accustomed to that. And, of course, it's up to the DM to do it.
They want out of the box monsters that are much more powerful to challenge their table with little to no work on their part and that they can run horribly and still be effective and when it doesn't work, they want to say that it is a design failing. What I am saying is that it is not a design failure
They're not great, but there are encounter guidelines, no matter how over the top a set of players might be, there's a setting on the dial that'll challenge them, it might be some ungodly multiple of 'hard,' but it's just a matter of choosing to present the challenge...
they designed a game that works very well for their target, certainly nothing I would call "broken".
If the expectation is a game that's clear/simple/consistent and just works out the box, it's "broken."
If the expectation is that the game will be D&D, it's fine, just season to taste.