IR in initiative: Except I don't think general experience helps you react quickly... I think relevant experience helps. <snip>
I'd disagree. Training in a skill (high ranks in a skill) is not the same as having insight into using that skill (higher IR).
So I think we're discussing "transfer of learning", which is the process by which learning one task improves performance on a different task. It's still a big issue being researched. I haven't read up on it in awhile, but I remember getting a pretty conservative view of it (i.e. there's not a whole lot of transfer; to get better at a thing, do that thing)... I have to go find a book I read like a year ago and get back to you.
And I think your descriptions of skills and IR don't mesh with RAW. Skills are "What characters learn through training and experience " (emphasis added) (p. 79). That RAW description matches the XP mechanic: play the game, get experience, get points, invest those points in skills, improve those skills. So while skill ranks represent training, they also represent other experience. I would think insight* into using that skill comes from experience (*using insight in the colloquial sense, not the game mechanic sense).
Insight Rank, on the other hand, "is a means of measuring the overall abilities of the character" (104). It's an abstraction that describes all abilities, not just understanding. Most of the game is consistent with that description. Initiative is weird in that regard; enough skill in anything lets you react faster--like lore, artisan, divination, and sincerity, which have nothing to do with reacting quickly.
Alternative initiative: <snip> trait roll of Reflexes or Perception <snip> Simple options make the game more accessible, which could help it spread to new players.
Your "simple option" is not as good as you think it is and will not make things more accessible. It is more a min-maxers tool than an accessibility option. It makes the Water Ring incredibly powerful as it now determines Movement speed, Initiative and damage dealt by melee and thrown weapons.
Yes, the water ring becomes more powerful, which makes it more comparable to the air ring, which was part of the point.
I fail to see how it encourages min-maxing... given the importance of basically all the other traits (except maybe intelligence), perception is usually a pretty min-able stat.
(pro tip: if you really want to avoid min-maxing, don't play with min-maxers. I'd rather not forgo sensibility or verisimilitude to punish bad behavior)