I can sit at a table with a PC built using the human species stats, give it a fully cosmetic monkey tail, and call it a Saiyan (got Dragonball on the mind...sorry) so long as I have DM permission - doesn't make that character anything other that human. They can't turn into a King Kong-sized were-monkey or one of the 50 different forms of Super Saiyan without working something out elsewhere in their mechanics (and likely a whole lot of homebrew).
The goal of enabling any permutation of mixed ancestry character without needing to enumerate each individual option as a bespoke statblock is something I wholeheartedly support, but the way they're going about it under the proposed rules means that a character going forward can no more be a half-elf/half-orc/whatever than my above character can be a Saiyan. I don't need them to be built as distinct species options, but I do think we need a standardized system that enables the DM/players to reliably construct one themselves, because the "Pick a Parent and Reflavor" methodology robs mixed ancestry characters of an important building block - the ability to have/develop a distinct shared identity based on a common ancestry.
It's not just the mechanics, it's the world-building implications. "Pick a Parent" robs mixed ancestry characters of a key aspect of community and forces everyone into the paradigm of being the perpetual outsider that does not fully belong in the societies of (at least one of) their parents, even if their parents and all of their forebearers going back centuries are the exact same flavor of mixed lineage as they themselves are. A thousand-year-old community of Khoravar (half-elves) built under the new rules are either going to feel entirely human (because they all use human stats), entirely elven (because they all use elven stats), or randomly disconnected from one another (because they use a mix of human and elven stats) - it no longer allows for Khoravar (or any mix of ancestries) to have a distinct identity of their own.
I have no issue with people wanting a spectrum of mechanical options to represent their X/Y mixed ancestry character, ranging from fully-X to fully-Y, but denying the ability for anything to exist in between those two because it's too much work or too hard to balance is a cop-out that only makes the stated intent to allow for any permutation of mixed-ancestry character ring hollow. Should the proposed rules stand, no one will be able to play a mixed-ancestry character anymore, because they functionally won't exist beyond cosmetic details.