IIRC, the original shuttle design was massive, with internal fuel tanks. Then, after interest in space waned after the moon landings, it was scaled way back to meet budget goals. The vast majority of the thrust comes from the solid fuel strap on boosters. But the liquid fueled main engines helps "smooth things out."
I think the concept of repairing satellites in space, and returning some to earth (as well as large experiment packages) was sound. Certainly the concept of the reusability of the "capsule" part was a good one. Things just did not work out very well. Those goals will one day be achieved, with better technology.
Taking a step backwards, or at least one perceived as a step backwards, was a terrible mistake. Come up with a larger Apollo capsule, then back off to where it won't carry any more people than the original Apollo, and put it on top of a solid fuel "spleen buster" rocket- well, as you say, poorly thought out. Had to fail to generate any interest or support. The whole idea of space travel implies moving forward. Nothing looked advanced about Ares/Orion.
Solid fuel has it's advantages, but also drawbacks such as vibration. Perhaps a hybrid solid fuel, where the rubberized fuel was oxidized by a separate, throttleable liquid, would have been a better idea. And moving to a smaller, human only transporter, with separate launch of materials, may also be a "better idea."
I support space exploration. I'm just not thrilled with NASA. I hope to see this shuttle launch succeed; same for the remaining ones. The shuttle pushed forward the art, just not to the degree hoped for.