A solid way of stating the state of things. Its true, the straight damage upgrades currently removes a lot of the balance, order and diversity of many, if not most weapons. What we need are performance upgrades, not simply straight damage.
Like its been said, the current system is just a placeholder to be refined as we continue along.
I think the best solution would be to revert the previous T4s back to their T4 status, and limit the option to upgrade damage to just once per weapon, if at all. Multiple performance upgrades per weapon would be ideal in the future, but until then, if we're stuck with only one upgrade avenue per weapon, it ought to be something that visibly impacts and improves how they perform, rather than just generically boosting raw damage. Furthermore, it will give weapons even more diversity while returning to a tiered system of weapon hierarchy. The natural order must be restored.