1) The proper dose of melatonin for me is somewhere between 150ug and 400ug, but most melatonin sold comes in 3mg to 10mg pills. That's around 10x too much, taking that dosage of melatonin destroys my sleep schedule. It takes a lot of hunting to find the right dose. I tried once to crush up some melatonin and make my own pills with a precise dosage, but that ended up being a bit of a disaster.
2) Melatonin is regulated as a supplement in the US. Basically that means there is no regulation and even the active ingredient can vary wildly in a pill. When I visited a sleep specialist they mentioned to always buy the same brand, because "Each supplier has a different incorrect dosage, your best bet for dialing in on the correct dosage and timing is hoping that they're at least consistent among themselves".
But I do agree with you, regulating it as a prescription medication would do more harm than good for most people. I wish there were some middle ground that would both solve the above issues but still keep it easily available for people who rely on it.
[0]: https://en.wikipedia.org/wiki/Delayed_sleep_phase_disorder