I feel like the answers you are seeking are more complex than can be solved here. Try to think of Valheim more as a game. Far less an obligation.

960 hours so far. Some of my Characters have higher skill levels than others. But in the end they are all happy with themselves.

It's ok, I know it sucks but you'll be ok

I'm pretty new to the game, but honestly, I don't care too much about skill level. Always glad to see the number go up... But that's pretty much it. And I like the fact there's an actual deterrent to dying. I'm coming from "7 days to die", and over there, people kill themselves to cure a broken leg.

And, from what I can tell so far, skill are just good enough to make a difference, while not being so good as to make the game unplayable if you lose them. (Though, I am not far enough in the game to comment on later stages.

-Skill level is quite important, though the right weapon for the job is very important as well.
For me, my biggest problem with the skill loss on death is it's impact on skills that I don't use often: jumping, swimming, and weapons I use only on special occasions.

-While I'm on it, I wonder if swimming will gain a value during development of the game, or be removed.

Now i did it, i cheated to spawn in back my lost skill levels, discovered the powers of spawning stuff in, and now i dont need to play it anymore. Thanks skill drain!