I agree with points suggested. Maybe the reason I considered it too powerful was due to the EMS phase of the Sharingan. I think the only exception to the rule of inventing good jutsu would be Rock Lee, as he cannot do sufficient hand seal techniques. But he is extremely exceptional.
In which case, I would suggest the following.
I reckon to fix the sharingan would be to do this:
1. Get rid of the EMS. Then the weaknesses of the Sharingan can remain intact.
2. Get rid of Izanagi. There is no excuse for this ability, regardless of its weakness.
Getting rid of EMS and izanagi would then be unfair to Uchihas. You shouldn't have a powerup that you will just eventually lose over time. That is so pathetic!!! Izanagi is also perfectly fair! Just kill the Uchiha 3 times to get around it. Sasuke killed Danzou 11 times! If he can do it, so can anybody else. It is also a brilliant and creative technique. I for one wish that you didn't go blind after using it. Also, no EMS means no perfect susanoo (and I love perfect susanoo)! Weakness is not cool man! The only way I would be fine with removing EMS, is if you could still get rinnegan afterwards by getting Indra's and Ashura's chakara and if rinnegan still allowed for perfect susanoo (as it does now).
In the case of Rock Lee as you mentioned, I think he can get better if he learns some of Guy's 8 gates techniques or makes some of his own.
If you notice, Lee has not actually showcased anything like morning peacock or afternoon tiger in his gates state. These moves are still taijutsu and don't require seals. They are also really good, as they allowed Guy to fight Kisame, 7 swordsmen, bijuus and even destroy Madara's susanoo. If Lee learns some stuff like this, then I'm sure he'll get better.