D&D trim levels

Are we discussing the wrong points when we talk about what character strength should be 1st level strength?  Great deal of discusion has been going on regarding this.  D&D Next entry level characters are too strong.  Old school characters are too weak.  First level characters should have such amount of hit points or should have so much more.  They should withstand one hit or many.

Is that really important?  Obviously it impacts play and the adventure.  But is it something to write rules about?  Isn't it more of a campaign setting thing?  Shouldn't the rules work for all character strengths?  On one side we have the characters played by the players and on the other side the world played by the GM.  If character strength increases without a world difficulty increase then the game becomes easier.  Yet if the world difficulty increases with character strength difficulty stays relatively equal.  Which takes me to the next point.  If character strength remains old school and D&D Next 1st level characters remain as 1st Edition 1st level characters, but the world difficulty decreases the game also becomes easier.  Doesn't mean goblins now have half the hit points, but they could very well give twice or more treasure than they did before.  So overall the cost benefit improves in favor of the character.  But I don't see that being addressed anywhere.  Why?  At what point is the GMs position put in question?

As GM you have all the resources in the world to create challenging encounters or to make them very easy.  Yet that's hardly the point of the discussions.  Why?  Why isn't the GMs ability to set a world power level, to provide story twists, to challenge the characters individually, and to create a compelling story not placed in question?

Why is balance such an issue?  Are character classes good at everything?  No.  Sure, if you center your game around combat and play the same storyline over and over you can be certain players will specialize for it.  Is balance an issue due to a lack of imagination on the GM part?  Lack of flexibility by the rules?  Lack of what can be done in the game?  Tabletop RPGs unlike their computer equivalents are much more flexible.  The GM, live and sitting by the players is the source of all options, twists, changes, stories, etc etc etc.  I honestly believe there is where the secret to balance is.  Not in the rules although they help and not in the character classes either.  So why put the game's trim levels in the rules?