Argo has a number of deployment and usage models, some which I think were not a part of the original design.
I think in the early days Argo was more intended to be interacted with via the UI, they put quite a bit of work into ACLs between their Projects, Applications, Clusters, and Repositories which would let a team pretty easily self-manage their environment. I don't think it was as common as today, with the app-of-apps pattern, to use Argo itself to manage Argo; so while the applications themselves were a gitops workflow, the bootstrap into that workflow was UI-based.
My favorite install method is per-cluster, run as something that might fit better in kube-system, we use the UI primarily for status info with a few users having permissions to run actions like restart and delete. With autohealing, deleting resources is often a great way to get things "unstuck".
Every other interaction with the cluster is via our gitops repo. We bootstrap a pretty vanilla argo install and then basically `kubectl apply -f clusters/primary/appofapps.yaml`. Included is an Application that takes ownership of the argo install and manages its configuration from the repo as well.
The Argo configuration basically has one cluster(local), one repo, and one project(default), so we don't really use Argo's ACL system much at all as all config happens through our standard PR approval workflow.
Its config is pretty flexible though, it's based on kustomize, so it's fairly easy to tailor it as you see fit. It doesn't need full access to the cluster and in fact even supports a namespaced install that has no cluster access at all (often running many instances on a control cluster with k8s ACLs giving users access to their own).
Ultimately, I think what you're seeing are some growing pains, but primarily features that make Argo flexible enough to target multiple types of control, ACL, repo, and cluster topologies. Them adding the ability to put Applications in other namespaces feels like a continuation down that path, just adding one more option (which I think will be pretty popular, like you mentioned, in multitenant situations).