I hear ya. I'm a known Dii skeptic (& P38 for that matter). I generally believe that they were necessary to get from the D1/RRC to the L319/L322 platforms which are excellent vehicles.
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D3 in most uses will smoke a D1 or like. The magic traction computers are just that, wonderful to behold off road. That said, you run into all the weird issues with sensors, voltage sensitivity, EAS problems, etc., while the older and very simple car kind of just goes.
As Ray says, generally the D1 is roped into the D2/P38 era of horrific issues when it really only shares an interior and body(ish) with the D2.
I'm going to go back on what I said because I remember this being the case D1 vs D2 and lumped them in.
I have an LR3 and know all to well about sensors but that being said it's never disabled the traction control system or EAS(not a problem either way with a Gap tool to clear/disable systems) I paid much less than most other LR3 owners(7k 2 years ago) and use it like a $7,000 vehicle(I bash the crap out of it and don't mind dents/adds character).
I'd bet the LR3 is larger which is nice for dogs(I base this on a guess) and stuff but on the trail I can tell you I wish it was smaller.
I prefer my LR3 but mostly for other reasons besides the off road stuff. It tows like a dream(have a couple boats) with the air suspension and bombs down fire roads where MOST coiled vehicles would break your teeth. I like the interior but like the interior on the older disco's too. 300hp doesn't make it fast but well you know.
I agree with your off road assessment though it's crazy some of the things it can do but its just that.. IT can do it and i'm along for the ride.
DI/Defender with front and rear lockers will smoke the ETC's all day long. Why? Because traction control is reverse ABS, slowing forward progress in the search for traction. Been there, seen them side by side, hill climb fails and successes.
Well duh. A locked solid axle vehicle is top tier in off camber situations/most off road.
On a 1000 mile trip who's going to be more comfortable though or a 100 mile off road trip for that matter? They both have advantages. I think a Disco might bridge that gap better than a LR3 for that matter(ive heard the defender rides pretty rough).
What about when something breaks..? I know i'd rather work on an older Disco or Defender... but my annoying sensors/computer tell me exactly what is wrong and where(with a gap tool). Like I said advantages both ways.