First off, thanks for investing so much of your valuable time here and sharing all of your ideas, thoughts - as well as pointing out the bugs you discover @StrangeTech.
I can’t add much, since most of the important stuff has been already mentioned, and I have to agree with all of them.
1-2 points maybe; the minor thing first.
Replacing the html tag placeholder with the default block tag is great and should not be underestimated.
Then, and that’s my secret favorite of this update.
Separating the main (HTML) area from the design (block options and CSS) area by bringing the tabs together below the main area is a major change which improves the workflow drastically.
After spending some time with it, it’s turning out exactly the way I have imagined when proposing.
Keeping the main area consistent throughout all tabs does the rest. It’s so good.