Newbie Defiler

Honestly, your rant is borderline useless... You really can't comment about a class and their effectiveness in the game until you're 90 with ER done and you get into heroic content. Everything below 90 (and really below DoV) is trivialized, just like every other MMO once an expansion is released. Your merc seems so OP because they are basically a level 90 player in quested gear mentored down in terms of power. Try holding agro off a DPS merc at level 20 on any tank class and you'll see what I mean. Defilers are one of the best healing classes in this game. Not only can you prevent a huge amount of damage with your wards (you'd see this a LOT better if you were 90 with everything the class can give) and with ER done you will actually heal when you cast a ward. It's true that they don't have the DPS or cures of other classes, but with the amount that they do, a second healer is almost never needed in heroic content except for the hardest instances. In raid content, the only reason to have a second healer is for the cures. It's very clear that you have very little knowledge of how this class works and what this class can truly do and I hope that if you do ever get the toon to 90 that you'll learn to play it correctly and not as a super lame scout.

I'm amazed that I missed this thread.
Amarth, keep in mind that many people who post here have played defilers for years. A lot of the changes/gripes you are posting are contrary to what the defiler community sees as good feedback. A lot of what you are saying is simply ignorance from not having played the class long enough. I do not mean that as an insult, but I suggest stepping back and reading what some of the other defilers are saying in this thread. I'll start by addressing some of what you've said:
Ancestral Avenger: This is the best single target deathsave in the game. If you do not believe me, find a heroic zone with lots of orange+ conned NPC's, toss this on yourself and then run up and gather as many creatures as you can. Notice that for the duration of this spell, you will not die. There are very few mechanics in the game that can bypass deathsave, and those are usually failure conditions on hardmode 90+ content. I'm curious where you have deduced that this spell is not working, as it works quite well and is one of our more potent survivability tools. Ancestral Avenger shows up in logs as coming from the target it is cast on. So the only way you'll actually see it show up as coming from you is if you are the one with it on just before a hit that would normally kill you.
Leg Bite: Like was previously mentioned, this ability is fine the way it is. There are encounters in the game where you an NPC starts to cast a brutal spell that can be interrupted. The current design of Leg Bite allows it to be somewhat useful for those situations. If it bugs you, you can either tie it into a macro with /pet attack or some other spell and never have to worry about the ability taking up space on your hotbar.
Rabies: I really don't know what to tell you here. Why is it that I can inflict disease based damage on targets with Imprecate? Am I diseased and passing that on to my opponents via ranged combat? We are a noxious based class. We do inflict disease and suffering on our opponents. Since rabies is a disease, I can understand why we would be able to magically inflict that disease onto our opponents. I could also ask how a wizard is able to bring a comet of ice down on their target's head, but this is a fantasy world so we can make stuff up to fit with whatever makes it easier to understand.
Hexation: I'll agree that in today's content, Hexation really isn't all that great. In previous content, however, this spell made a huge difference. The problem is that the development team got rid of a lot of the defensive proc mechanics that existed on stuff pre-Sentinel's Fate. If you had played a defiler back in The Shadowed Odyssey, you would understand why Hexation shined so well back then. One of my biggest uses way back in the day was on Byzola (Shard of Hate). Hexation dramatically decreased the chance of your DPS classes being feared constantly, which in turn helped raidwide DPS when the spell was active. A lot of classes complained about constant stuns and such from those defensive procs on NPC's, so the developers leaned against that mechanic in content after TSO. If they ever bring back those mechanics, then Hexation will be more useful again. There are still a few situations out there where it is handy, though if you're soloing or grouping then you will not likely notice it doing much for you.
Mail of Souls: Our primary group cure is the exact same as every other priest, and cures based on the level and quality of the spell. If you played any other healer class, you would notice that their group cure is the same level as the defiler's and cures the exact same number of levels. The only differences are the little extras each priest class gets added to their group cure via AA's (i.e. wards, heals, etc.).
DPS: Defilers as a whole are bottom tier DPS for priests. We're not the worst, though, as I'm fairly certain templars are below us since the addition of Avenging Ancestors. That being said, towards the endgame you'll find that defilers can do decent damage against multiple targets. I normally do not beat out inquisitors, furies or mystics that are dpsing but I hold my own just fine if I actually have time to DPS. You also must keep in mind that we are a very defensive priest, and very instrumental in keeping tanks up on difficult content. It is when that content becomes trivial healing-wise that we lose our edge against the more offensive priests.
Healing Compared to other Priests: The problem here is not how much other priest classes heal, but how much healing is needed for the situation. Obviously if you are doing easier content, our extra healing isn't needed so more offensive priests are seen as more useful (since they bring both more DPS and offensive utility than us).
Honestly, I'm all us gaining more utility and more useful DPS options. For example, change some of our AA's that modify our damage over time spells to decrease the duration of the spell (i.e. force it to tick faster). Defilers have long been asking for the entire INT line (i.e. Rabies, Scourge, etc.) to be redesigned to be a better DPS line for us. We don't need a whole lot, though, because in the end we are beastly healers that are capable of doing amazing things when it comes to keeping a group up.

You can easily make it to level 87 and be incompetent at any class - especially a healer that leveled solo. You clearly don't understand the class if you are comparing what you can do to a merc healer. You were not doing any content of any consequence if a group you were in put the group together by including you as one healer and a merc defiler as another.
My dog never dies, even against raid mobs, because I'm not counting on him to tank a mob. I'm counting on him to do what AA's say he's going to do. Since that works all the time, with no exception, I only lose him when we are jousting and I don't call him off the mob (ie, get him to joust too). If you don't back him off for a big AoE, he'll die, along with probably one or two groupmates that didn't back off, too.
Defiler is not a 'pet class' (like necro or BL for example). You have a pet that is a visual manifestation of some abilities you can do. To expect more also indicates a lack of understanding about what that AA was intended to do.
Ancestral Avenger is an amazing death save. The only priest with a better death save is a Warden, and only because they have two (single target and group), and with AA they have a chance at 4 triggers of a death save on a single target. It always works. No priest death save can work if you aren't casting some heavy healing behind it. It may pop the save-ee back up again but after that, it might take some fancy healing to recover. It's a Chance, not a Guarantee.
Mail of Souls always works. The only reason it wouldn't would be if it wasn't upgraded (by you) and the level of detriment it would cure is below the level of the mob. You may have it at expert, but which one? The first one you got? In that case it would be resisted and wouldn't work. If you have a level 50 mail of souls that will cure up to level 73, and you are fighting level 85 mobs..then yeah...it doesn't cure. If the spell description is within the level of the mobs you are fighting and it doesn't cure, then the detriment is incurable and no priest could cure it. It will cure one of every detriment on your group. If there are more of the same kind of detriment, you have to cure again, and probably single target cures because your group cure has to refresh. Learn to cure.
Your damage is situational. Defile is pretty powerful in a big group of mobs. No one really brings a Defiler expecting you to DPS though. Shaman is the game's first line healer the way mechanics read heals. A ward is a heal, that's how it's read by the game.
You've spent many pages complaining about this class, yet you played it to 87 (probably 90 or more now). It sounds to me that against forum and class advice, you've tried to spec some kind of hybrid of healing and damage then complain when it doesn't do amazing heals and damage. You have to pick one and stick with it. If you try to spec both you will do both badly.
If being in a group with a merc of any kind bothers you, don't group with them. If you think the class sucks then you are probably bad at it. You haven't grasped the concept of some things you give up for doing others well. I can ward 13K HPS in a Skyshrine raid fight. For being able to do that, I don't expect insta-cast heals or cures. My mail of souls cures every time I use it. I do 35K damage on some aoe fights spec'd as pure heal as I can get...and my gear is good but not amazing. My dog rarely dies..even if I die, he rezzes with me. And I'm a sort of decent defiler - not even one of the best ones.
L2P is my advice.