Wait, I'm confused. You've stated that if there's a hidden attacker, you force people unaware of the attacker but still able to act to pick an action without knowing anything about why. Let's unpack this, then:
DM says roll initiative. I ask why, the DM says you don't know, but you won initiative, what do you do. I again ask what's going on to cause initiative, and I'm told nothing that I'm aware of, so I can either choose to engage in metagame thinking and pick and action with no in game reason that's defensive, like dodge, or metagame and pretend I don't know anything and blunder on. When the unknown cause of initiative goes, they can now pick an action to take advantage of my chosen action and retain all of the other advantages they had if I had lost initiative, only now I do not get to take a meaningful action in the first round.
Let's say I lose initiative. The bad guy get to do exactly the same thing, but now I get to react with a useful and meaningful action on my turn.
Please, praytell, expound upon how the first is better than the second.
The Alert guy does know something; he know's that combat is about to start!
Meta-game, the player legitimately knows that combat is about to start. In game, the PC gets that tingle, hairs-on-the-back-of-the-neck, "I've got a bad feeling about this!" sense that it's about to kick off. They have the advantage (with a high initiative) to get to take actions that surprised PCs could not or that they could not if they rolled lower initiative. So, yes, it's
usually an advantage. Still, going first has never guaranteed to be 'better' than going later in the round. Plenty of friendly-fireballed fighters can testify to that!
But even though the Alert guy knows things are about to kick off, if he failed his Perception check then he simply has failed to perceive what the threat actually is, even though he knows there is one.
You're picking the wrong point to enter into initiative.
The correct point to enter initiative is when a hostile action needs to be resolved. If the hidden enemy wizard was about to cast
prestidigitation to make his snack taste better then this does not start the combat process. But if the enemy wizard is about to cast a
fireball to engulf the party then the process kicks in: DM determines surprise (using whatever method he likes, but in this situation Perception vs. Stealth) and initiative is rolled. It may follow that the Alert guy goes before the wizard gets his
fireball off, but his Perception fail means he didn't perceive the wizard. The Alert guy knows there is danger, but he simply doesn't know about the wizard specifically. Them's the breaks.
Yes, that doesn't make sense, very good. But we're not talking about how perception checks work, we're talking about how initiative works. The failure of the perception check means that a character doesn't know where the threat is, not that there's no threat. If you ask for initiative, it's incumbent upon you to make the threat known. If there are players that are not aware of the threat when initiative starts, that's what surprise is for. If some of those players have the alert feat, then they're not surprised, but still aware of the threat. They may not know where the hidden wizard is (the wizard is hidden, after all), but they should be aware of the threat in some other way. "You have a tingle of danger from your right", "you hear a low chanting as if spellcasting, but can't tell where it's from", "you see a glint in the darkness that warns you of danger", whatever floats your boat. But there should never be a point where you, as DM, have asked for initiative, and a player wins that contest, and you smugly say 'you have no idea anything's wrong, so what do you do knowing nothing is wrong?'
They
are aware that something is wrong, but they failed the check which would give them information based on perceiving the danger itself. Tingle of danger? Yep. From the right? No. They have no mechanism to know the vector of the danger. They failed their roll to
hear the spellcasting or
see the glint in the darkness. Those are the things that the DM would reveal on a
successful Perception check.
If they don't perceive the wizard, there's no need for initiative. The wizard, hidden, does what he wants. If the wizard starts to attack the party, he's doing something that means he's attacking. If you call for initiative, it's on you to know what that is and relate it.
You're wrong here. There is a need for initiative as soon as the wizard attempts a hostile act, whether or not he is perceived. The whole relationship between surprise and initiative is built on this premise!
DM -- "There's a sudden low chanting from the darkness with that feel of magical energies coalescing. Everyone roll perception, DC 14, and then initiative. If you fail the perception check, you're surprised."
Darnell -- "I failed the perception check, but I have the Alert feat. I have a 19 initiative.
DM -- "Okay, you beat the bad guys in initiative. You know there's some casting coming from the north corridor, but you don't know where. What do you do?"
See, you don't have to provide perfect information, but you do need to set the scene so that the players have enough information to make meaningful decisions. As you present it, it goes something like this:
DM -- everyone please roll Perception, DC 14.
Bob -- I got a 12.
DM -- okay, you're surprised, roll initiative.
Bob -- I got a 19 initiative, and I have the Alert feat, so I'm not surprised.
DM -- cool. What do you do?
Bob -- um, what's going on?
DM -- you don't know, it all seems normal, what do you do?
Bob -- uh...
This is unsat.
Both of those are 'unsat'. 'Sat' would be:-
DM: I need Perception checks AND Initiative checks from everyone.
Bob: I got a 12 Perception and 22 Initiative.
DM: You're surprised, and you're first to act. Because you're surprised you cannot move or act this turn.
Bob: Wait, I have the Alert feat so I'm immune to surprise.
DM: Okay, you
can move/act; what do you do?
Bob: About what? I failed my Perception check so I don't know about the enemy.
DM: True, but you
do know it's about to kick off big-style! You sense danger, you get a very bad feeling about this! Based on that uncanny gut instinct, what do you do? Stand around and look gormless just like the poor saps who are surprised and
can't do anything?
Bob: No! I move behind the paladin, draw my bow and Ready an action to shoot the first enemy I see!
DM: Better then being surprised, eh?