I'd argue that it was all downhill after we moved away from using HTML as the state representation.

Moving state out of HTML and into JS means we now have to walk this ridiculous tightrope walk trying to force state changes back into the DOM and our styles to keep everything in sync.

Given that problem, reactivity isn't the worst solution in my opinion. It tries to automate that syncing problem with tooling and convention, usually declaratively.

If I had to do it all again though, DOM would still be the source of truth and any custom components in JS would always be working with DOM directly. Custom elements are a great fit for that approach if you stick to using them for basic lifecycle hooks, events, and attribute getters/setters.