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Lord Seth: The card isn't designed for you. It's a Timmy card, not a Spike or Johnny card. Comparing it to Elesh Norn isn't really fair, they each do very different things. Elesh Norn is better in some circumstances, and Avacyn is better in other circumstances. Is Elesh Norn better? Maybe, but Elesh Norn is an absurdly good card, so if Avacyn is even comparable to her, then that's a pretty good sign.
"Won't see play in tournaments," does not mean, "Won't see play." She will absolutely see a ton of play in various formats on thousands of kitchen tables around the world.
It's good for there to be a few tournament-grade mythic rare cards in each set, but every mythic rare was a tournament-grade card, then they would be even more expensive, and playing in tournaments would cost even more than it does today. It would also make mythic rare cards much less fun for all the Timmies and Johnnies out there that prefer a different kind of card.
Could she have been tweaked to appeal more to spikes and johnnies? Sure. For example, imagine the following two cards:
Avacyn, Angel of Hope 2WW
Legendary Creature - Angel M
Flying
Avacyn, Angel of Hope and other creatures you control are indestructible.
3/3
Avacyn, Angel of Hope 6WWW
Legendary Creature - Angel M
Flying
Human permanents you control are indestructible.
At the beginning of your upkeep, put a 4/4 white Angel creature token with flying onto the battlefield.
When Avacyn is put into a graveyard from anywhere, its owner shuffles his or her graveyard into his or her library.
5/5
The first one appeals to Spikes, with it's fairly aggressive cost and great resilience. The second appeals more to Johnnies, with it's powerful and interesting abilities that interact in cool ways. Of course, neither of these appeals to everyone. The first is too small to be interesting to a Timmy, and the second has too many words and not enough raw power. The first is too simple and straightforwards for a Johnny, and the second is certainly not playable to a Spike.
Okay, so let's try and make something good for everyone:
Avacyn, Angel of Hope 3WW
Legendary Creature - Angel M
Flying, Vigilance
Other permanents you control are indestructible.
5/5
There. It's kinda big, so Timmy likes it. It's not too expensive, so Spike might play it. It's interesting to Johnny, since if you protect her then all of your stuff is invincible. So this must be the perfect card, right?
No. It's big, but it's not big or splashy enough to really impress a Timmy. It's playable, but not enough that a Spike will really be excited about including it in any of his decks. It's got a bit of interesting interactions, but beyond sticking a pair of lightning greaves or a suit of darksteel plate on it, Johnny doesn't have much to work with here.
Which comes back to the issue of "If you try to please everyone, you end up pleasing nobody." With Avacyn, they decided to please Timmies, and I would say that they succeeded from what we've seen so far. She's big, she's splashy, and she's got and she does something pretty unique. You can't ask for much more from a Timmy card.