People, which were playing the mod already for years got involved into those spirals. Peaceful stable empires which were all the time in the positive happiness get in short time into trouble and even doing what you are saying (stopping immidiatly growth) lead to death spirals and nothing helped. Saying all those people are too dump to play the game is kinda arrogant.
The median-save was integrated to prevent this. Not to increase the amount of time you have to react like you have said.
That view is so one-dimensional. If the game forces me the whole game into such a manner, whats the purpose then to play a highly complex game then?
Not everyone wants to punish growth that greatly. In my India game, I had 50% more score than the best AI, tech and policy leader and had build, even with fast tech progress, everything what was possible. With a normal focus, I would have ended at 35% happiness.
Do you really want to say I shouldnt have to grow that much? Whats the purpose of playing a growth orientated civ, if Iam forced to play only tall with it or throw away my benefits to get a wider empire?
The Happiness design builds around choosing between growth and expansion, it's not about being peaceful. People don't have to be dumb to fall into an unhappiness trap like you say, they just have to ignore what happiness is meant to achieve.
Happiness isn't about how well you are doing relative to the AI either, lead in tech, policies and so on are not relevant. Happiness is about curtailing how you grow and expand, with the ideas behind Tall and Wide being two extremes in this manner.
And why you would feel forced to play with a specific playstyle with a civ specialized in a certain capability, that's true for many civs, not just India. Wide India is akin to playing Peaceful France, Tradition Carthage or Wide Korea; you can try and make it work, but the synergies in the alternative playstyle are obvious and hard to ignore. If you're going to play with a civ specialized towards growth, it makes sense to go for a playstyle that synergizes with growth, which is Tall, and avoid a playstyle that struggles with growth, which is Wide.
If you want to have multiple options open for your civ, you're probably better with a more generalist civ, like Ethiopia, Poland or The Celts. This type of civ lets you pursue multiple paths and don't ask for a specific playstyle.
And if you really want a civ that can play Wide and still grow like a Tall empire, try Brazil. The -50% needs during Carnivals (WLTKD) was added specifically to make Wide a viable path for that civ, who is reliant on GAP generation through happiness. I think Tall is overall stronger for that civ, but Wide is doable and without the unhappiness issues of pursuing both growth and expansion.