Well,
While I respect Thimble on the Spit's opinion.
1. As far as the balance issue... Why wouldn't anyone play anything other than an elf? Because unlike standard fantasy, Tolkiens world has races that are "unbalanced" compared to each other. In most dnd/fantasy world, elves are merely humans with pointy ears that need to have enough disadvantages to equal a human. Elves in Tolkiens world are more perfect creations and more powerful... but they are also otherworldly, surreal, and vastly different. If a player wants to roleplay that challenging role, then they could be an elf in my game. Most players can't or don't want the "restrictive" nature that LOTR elves have. The cost is two high. Only a few are up to the challenge. In short, this is a balance issue sure. If you can handle games in which players are of different power levels then it is a great strength. If you can only p[lay games that are "perfectly balanced", which I personally have never seen, then it is not for you.
2. The artwork and text. This is a judgement call and is subjective. I thought it one of the more beautiful RPG products I had ever had.
3. Atribute names changed for "feel". Again, subjective. I liked it. A hobbit is nimble far more than agile in my opinion.
4. Magic. It is an RPG, after all, and I had no problem with a wizard doing "more" than we see gandalf do. More important to me was that the magic "felt" like middle earth. To me it did.
5. MER. Ahhh thimble in the spit, we might agree some here. MERP supplements are far more meaty than what as been released by decipher. While Decipher's Fellowship of the ring supplement is more pretty than content (something that the trek supplements are as well, IMHO), some of that has something to do with the nature of the liscence and what they can put in the game. They only have access to LOTR (and maybe the hobbit, can't remember). All of the rest of tolkiens work is held by Tolkiens son, who refuses to grant the rights, and disklikes RPGs as I understand. MERP grabbed stuff from everywhere they wanted, with little restraint. Even places they weren't supposed to. This violated the copyright liscences, something that Decipher isn't doing, whether by choice or contract. I think that the designers would love to dip into that material, they just can't.
Soooo.....................
In short, LOTR assumes that a GM is running a story, and has fluid rules that help guide the story cinematically. Where as D20 is more of a rules heavy toolkit with rules to adjudicate every thing. D20 tries to have a rule for everything. Coda assumes that the GM will have the control and wisdom to adjudicate effects cinematicallyh for the benefit of the story. Both have their strengths, both have their weaknesses. It depends what you like, and what kind of story you like to tell.
I like them both. I actually run D20 more in Coda's style which is rules light. That is the beauty of D20 and any game. It is YOUR game.
Razuur.