Your proposed changes will only make grabbing stronger than it currently is by guaranteeing damage from pummels, while also still not “validating” pummeling and mashing.
In the cases where throws are too slow and/or visually too distinct (such as all of Kirby’s throws which all have 34+ frames of startup), then players will always be able to mash and then react to the throw (thus always leading to correct DI). This makes mashing absolutely required for no reason (since the opponent will always react properly), while also guaranteeing extra damage from grabs (through pummeling) at all times.
In the cases where multiple throws are unreactable (or difficult to react to) while requiring separate DI inputs (the idea behind Shiek’s down and back throw which both have 17 frames of startup), then those grabs would always be able to get pummel damage + a mixup regardless if the player mashes or not. Since grabs are now guaranteed extra damage (through pummeling), a player being held will want to mash out as soon as possible to avoid the worst possible scenario (being pummeled as much as possible AND failing to DI properly).
In the cases where only one relevant throw is unreactable (such as Fox’s Up throw which has a 9 frame startup), then going for the DI is the best option, since missing the DI could potentially lead to a stock and the alternative leads to small pummel damage. The player being held can always mash during the pummel (given that the pummel is slow enough) and then immediately hold the DI, thus always being able to DI correctly. This means that there is little to no reason for the player performing the grab to pummel in this situation.
In all the possible situations as explained here, pummeling still serves no function, other than to make throws (such as guaranteed KO throws) stronger for no reason. In terms of practicality, your proposed changes would also nerf certain players such as Dakpo who (according to 210stuna) apparently can mash out of a grab at 100% after only one pummel (without enough time to get the throw afterwards).
What matters most about fixing bad game design is addressing its function. Adjusting game elements might be perfect for the situation, but removing game elements can be what is necessary. Random tripping is a perfect example of bad game design and it was completely removed which improved the system and the competitive value of the game.
Thus the question that should be asked here is:
Is the minor player-player interaction in the current system important? If so, then why don’t we have such interaction with certain grabs such as Bowser’s and Ganon’s side B? Bowser’s side B used to be able to pummel in Melee, but it was changed to no longer be able to pummel in PM. Was that the wrong decision? Should the minor interactions have been kept there?
In most other fighting games I know of, when you get a grab while failing to defend (usually it can be teched, although in Smash, you can spotdodge it), then you get thrown. Why add another mechanic such as pummeling? What competitive value does it actually have?
I didn't say my proposed system was perfect. But it's better than the current system. In the current system, pummel damage is
already guaranteed past a certain percent, and my system would use the same general numbers. The main difference is you actually do have to sacrifice DI in some scenarios for mashing, because potential pummel damage goes from like, 3-9% (depending on your current percent) to like 10-20% if you choose to not mash and just DI instead. In Melee you were basically guaranteed a pummel for every ~35%. In Melee you also generally needed to mash with the control stick usually since your mashing was pretty slow otherwise, so you did actually risk DI. The opponent needs to be a little higher per pummel in PM, or if they use brawl methods for mashing (which still exist in PM) they need to be
much higher, like 70-100% per pummel. "Nerfing" players like Dakpo isn't a valid argument, they are mostly abusing brawl's awful pummel mechanics, there's really nothing special about it. My proposal would probably use the same numbers as Melee. Avoiding like 9 extra damage from 3 free pummels isn't inherently the best scenario even vs a throw mix-up like sheik's. Most throw mix-ups like sheiks actually do have a single optimal DI option, for several reasons. First, for example, if you're near the edge, and either throw would give a free hit with bad DI, you DI away from the stage. That way, her combo throw sending offstage doesn't get another free follow-up offstage, and her combo throw sending instage gets a free hit, but you get send inwards. This is also the case with wario's bite. Additionally, most normal grab throw mix-ups don't have identical properties. Using sheik's as an example again, he bthrow has a higher angle and higher release point and less endlag, making it better on faster fallers, so fast fallers generally want to DI for that throw regardless. There's also downward DI, which gives slight DI away for both throws, which is better than no DI. As for characters with throws too slow to not react to, well that's why the system isn't perfect. In those scenarios, there's no real reason not to mash... except in teams scenarios, or to avoid certain grab release shenanigans. As for characters with only one unreactable throw, waiting to see pummels to mash, then trying to DI inbetween them, gives super suboptimal mashing as pummels last less than 30 frames, so given reaction time you'd be mashing less than half of that time. And if you DIDN'T wait for the pummel to try to mash, and the opponent threw early, you'd miss the DI.
Other issues with your claims-
fox's bthrow and fthrow are also pretty unreactable
tripping is not even comparable to mashing, please do not apply my statement about removing/changing game mechanics to tripping because we both know that's a strawman
Bowser's pummel no longer exists in PM because of technical limitations, it wasn't "removed" per se
Ganon's with a pummel wouldn't make sense
Those are both bad examples because command grabs inherently work very differently anyways as they usually only have one or two throw options, and can be done while airborne, and may have hitboxes attached, much different endlag/start-up times, etc
Why have more mechanics than other fighters? Why have DI? Smash DI/ASDI? CCing? Aerial drifting? Rolls? Shield density (soon[tm])? Shield angling (including behind)? Platforms? Edge canceling? Are you kidding? What kind of question is that? It's smash, even the less deep installations generally have ridiculously complex option trees compared to traditional fighters. The point isn't to add a new mechanic, it's to improve one that almost works, and make it usually work like that.