As to the dialogue: I don't think the "dialogue" any worse than the originals. Here I think it's just that Lucas was so driven by his "1940s style melodrama" style it made it look ridiculous at times. You just can't use the "Gone with the Wind" style drama these days especially with rookie actors like Christiansen....let alone have him being directed by Lucas.
I do like your idea of Obi-wan being the focus. That could have worked as well. Given the actor (McGregor) had a lot more experience than Hayden Christiansen this might have worked better.
I just think that overall the prequels failed due to a lack of any kind of chemistry with the characters and that I blame on Lucas.