I'm sorry, what? You don't like YAML because it uses whitespace as a delimiter instead of curly braces? That is probably the least important feature that YAML adds for CF templates.

YAML, despite its warts, is much more readable and maintainable for CF templates than JSON, particularly when you are doing non-trivial things and need to use a lot of intrinsic functions and string manipulation. Or you want to put comments in your template.

I've worked on huge JSON and huge YAML CF templates (I'm talking templates that are thousands of lines long--in YAML). YAML is without a doubt easier to maintain.

I can't recommend any CF libraries for generating templates either, unless you want to wait around for new CloudFormation features to be implemented or suffer from half-broken existing implementations (or waste time hunting down bugs and submitting patches). Sometimes it makes sense to use a template engine like Jinja or ERB. But I'd stay away from libraries that generate CF templates--they're mired with missing edge cases and they're mostly an unnecessary dependency.