I just want to put on the record that I have not overlooked this! I've posted about it, on-and-off, for the last 15+ years. It's one of the strongest aspects of 4e as a FRPG,
and as a version of D&D.
I generally agree with your first quote (though a planer arrangement can also be cool/compelling in its own right), but not quite with your second. The traditional ("Great Wheel") outer plans exist because they reflect certain game idea - especially alignment and elementals - and connect those to some literary/mythological traditions. I agree with Lev Lafeyette's description of its original presentation (in Appendix IV of Gygax's PHB) as a "rather evocative assignment of Earthly polytheistic pantheons within the AD&D alignment system".
I think it was the effort of making the outer planes not just a set of evocative ideas but actually and systematically amenable to game play - via the MotP and the Planescape - that created the unplayable stuff that 4e then reacted against.
In the early presentations (PHB Appendix IV and DDG) there is no suggestion that the wheel is mere metaphor or design. And then in the MotP, and I believe also Planescape, the wheel is explained in terms of portals - eg Acheron has portals to Nirvana/Mechanus and to the Nine Hells; the Nine Hells has portals to Acheron and to Gehenna; etc. And it is these portals that establish the literalness of the "wheel" arrangement.
Even if one doesn't include those portals, there is still the classification of planes by alignment, which then supports an arrangement of them analogous to the alignment graph (compare pp 119 and 121 of Gygax's PHB). That is not a merely arbitrary arrangement, and it reveals the wheel-like structure of the planes.
What 4e does is break the relationship between the outer planes and alignment: it permits multiple planes for similarly aligned beings (eg Tiamat and Zehir don't get stuck in the Nine Hells) and permits differently-aligned beings to live in the same place without that creating alignment oddities (eg Erathis, Ioun and Pelor all living together on Hestavar).
I agree with
@TwoSix that the
souls stuff is pretty peripheral. But the relationship of outer planes to alignments, in the Great Wheel, is not peripheral. If you drop that, you no longer have the Great Wheel. And while you do have it, you get the symmetry of the alignment graph projected onto the cosmology. And you also get the problem of what to do when an aligned plane becomes inhabited by, or conquered by, beings of a different alignment. The Planescape approach to that, which
@EzekielRaiden has criticised, is probably only one possibility. But I don't think it's a case of "anything goes" - I mean, it would be weird for the Seven Heavens/Celestia to remain a plane of absolute LG if it had been conquered by and was now overwhelmingly inhabited by devils and demons.
To me, both these suggestions seems a bit narrow. Who knows
how vision works in the Outer Planes - or for that matter even on the material plane! Even if photography worked on the material plane, there's no reason to think it would work in other, more magical, places.
And as far as the relationship between belief and reality, it seems possible (perhaps challenging, but possible) to imagine a fantasy setting, or some aspect of a fantasy setting, where what a person encounters or perceives reflects, in part if not in whole, their fears, hopes and expectations. This could be done comedically, a la the Alice books, but perhaps seriously as well.
EDIT: Link to Lev Lafeyette quote:
Review of AD&D First Edition Players Handbook - RPGnet d20 RPG Game Index