The Diurnal AST will always cast fewer spells for more returns if they do it right. The HoT ticks are what help you follow with a Benefic I rather than II, for example. And yes, being able to apply your HoT whenever you want to = on-demand. Contrast with SCH's only HoT, which is tied to a 60 second CD and a specific fairy.

I think you severely underestimate the usefulness of HoTs because you only perceive them as tacked-on overhealing rather than as a key component in your healing strategy.