I don't equate "raiding" with "progression raiding" while you seem to. FFXIV includes easy content like Void Ark and CT as raids, for example. I also think its a little pretentious to say there is only one reason why anyone should ever want to raid and anyone who raids for another reason is "doing it wrong", to use the internet meme. I do realize that a significant portion of FFXIV community sees raiding as either serious progression raiding or nothing, but I feel this leaves out a lot of people who still attempt difficult content and most statics I've seen would be considered about as casual as I am. It's been discussed many times how little of an MMORPG community seriously raids and I don't feel it is good for the game or the community to have a large gap between progression raiders and everyone else by creating big difficulty gaps within endgame content. I'm also a little hesitant about your assertion that raiding "exists to challenge players to the fullest extent" when A3S and A4S (generally considered to be the toughest raid instances while current) did a lot of damage to the raiding community on many servers. I'd say there's evidence that really difficult content actually hurts the FFXIV community so I believe that if we have to choose between kind of hard and very hard, we should choose kind of hard.
While you mention that you wouldn't have a place in the game without a difficult Midas Savage, I already feel like I don't have a place in the game with its current content and based on conversations I've had, I'm not the only one. I personally would rather see a middle difficultly level created rather than a nerf to savage, but the devs have said many times they won't make a third tier so I feel the next best option is making the hardest content (currently Alex Savage) easier.