My ideal solution would be for Safari to keep some of the new features, like the tab groups, Quick Notes, the tab overview, and possibly even the new address bar on macOS. But the new floating address bar in iOS, the tab bar in iPadOS and macOS, and the sparseness of buttons should be at most an alternative and not the default option for all users.
I’m not saying that Safari should never be changed, but it shouldn’t be changed for the sake of it. This design has been proved to already be a bad move, and I don’t believe that mailing small tweaks here and there are going to fix the major flaws.
Apple should ship this new version of Safari as a separate app through the App Store and keep the current version of Safari built-in to iOS. Spend at least a year working on the new version, collecting feedback, and tightening up the design. Then re-asses whether to go forward with integrating it into the system or not.
It would be neat if they built this alternative Safari as if they were a third-party developer too. A bit of dog-flooding would go a long way to discover pain points and improve the situation for developers.