I never really thought flight worked out so well in the logic area any place beyond flying over things while walking. I don't find it logical to fly low enough to engage one mob and the others are magically unable to touch you. To fly low enough to get items from the ground, but mobs can't touch you. To fly low enough to cook/bury a body but mobs can't touch you. To fly low enough that someone can hear you speaking to them, but use fly in a PK to avoid their being able to touch you and turn it into a one sided slaughter. To fly over an entire community of giants high enough so they, as giants, can't reach you, but you can see everything below you. To fly in any indoor place but be able to lower to fly through doors and be left untouched. So on, so forth.
I agree that the Fly spell wasn't at all logical as it was. If you fly low enough to engage one mob in melee everything else there should be able to hit you. If you fly low enough to pick up something, mobs should indeed be able to hit you, as with body disposal. The flying low enough to overhear someone and speak to them does make sense to me. Specifically I would say that the Fly spell is meant to lend a tremendous advantage which is why in standard D&D (well, 3.5 ed) it lasts a minute per level, which is why I think that the duration adjustment is a good thing.
But! I do think that it should be, for example, possible to use Fly spells to scout, by flying overhead to look over the danger and report back. It also really, really shouldn't be possible for a mob with a melee weapon only to fight a wizard in the air slinging ranged spells. Much better would be to give them a ranged weapon. All my D&D characters, ever, have had a back up ranged weapon, even the ones with flaws in ranged attack, for just this reason.
I also note some big disadvantages which may have been overlooked here. Yes, a lowbie wizard can avoid combat by keeping their eyes peeled. But one of the distinct advantages of the Fly spell was not having to run backward and forward like a lunatic (i.e. not use up too much stamina). Believe me, as a lowbie wizard you have far too little of the stuff in the first place, and if it gets worn down very quickly and you then need to flee and can't, you're, well, doomed.
The other disadvantage is also related to hampered fleeing. Formerly, a wizard with the Fly spell could flee into the air (end up in next square out of combat), whereas now they can 'fly' up and away from combat but still get mobbed by the enemies on the 'ground' around them in the next square. Fleeing is essential for a lowbie wizard to balance out squishiness and I despair to think how much harder the already insanely difficult low-level wizardly grind will get.
I can live with the 'just drifting over the ground' explanation, just, but I can only say I really, really look forward to those changes mentioned being made. Whilst the old Fly was broken and overpowered, I honestly think the new Fly is broken and underpowered.