Level scaling is like putting a band aid on a deep gash.
First, I'm sure many of you agree that when it comes to rpg's the sense of progression must be compelling. Second, for a game to remain interesting it should be challenging in some aspects.
These two goals tend to be at odds in open world rpg games. In the old linear rpgs this problem was solved by throwing more diverse and tougher enemies as your character(s) progressed. Overall your character(s) power level was always relatively equivalent to the enemies you were facing, but the feeling of progression was there because the enemies' visuals and lore painted them as much more powerful than enemies you've faced before (also because in some rpgs you could return and whoop previous enemies' asses).
Level scaling is an attempt to fit linear rpg design into an open world. Trying to make sure that no matter what path a player takes around the world, it will be challenging enough to keep them interested. Of course, we know many people dislike it because it makes the challenge feel fake when enemies you've previously encountered become much stronger and robs the player of the sense of progression. If the world around you is always as strong as you are, then what was the point of getting stronger in the first place?
There are a few proposed solutions to the problem, but each has their own problems. The most obvious one many ask for is a static strength world like linear rpgs. This solution allows for the sense of progression to be kept intact, and allows the player to pick their challenge level based on their location. However in an open world game with a static strength world the player doesn't necessarily have the exact knowledge of which areas are safe and which are dangerous. How is the player supposed to gauge a threat they've never experienced? There are some people that like that sort of thing, but I believe that they are outnumbered by those who would prefer a more streamlined experience. At least for me, I like to be able choose if I'm going to dive in over my head or stick to a suitable challenge. Another issue with a static world is that it can be easy for a player to miss the window of challenge for an area. If there are many places with a similar level of challenge. or the player finds a way to jump up in power quickly, some areas become obsolete before the player ever visits them. It becomes quite hard to control the level of challenge when you can't base it in part on the player's strength.
One solution I've thought of is like level scaling, but with a twist to salvage progression. Say the world scales in level like we've seen in games like FO3 and Oblivion, but once a player "clears" an area, all the creatures that may spawn there remain at the level they were when the player "cleared" that area (the definition of cleared would have to be a game and area specific detail). This lets the game keep up with the player in power for new areas the player is exploring, but allows them to feel their progression when they return later for whatever reason.
Another idea of mine is not to scale the power of enemies directly, but rather the range of power they can be. For instance say you're attacked by bandits at lvl 1. They're all pretty weak and you can take them on in 1v1 combat but as a group they're dangerous. You get a little stronger later on and find you can fend off the weak groups 1 vs. group. Then as you grow more in power the bandit group composition shifts. Most of it is still the same weak bandits from the beginning, but now they have a leader who rivals your own strength. The expanding maximum power of the range allows weaker enemies to still spawn, allowing you to feel strong, while some of them still pose a challenge.
Alright I think I'm done with this post. Just a loose collection of my thoughts on level scaling in Bethesda games.