The main issue is that I think the pokémon sucking is just gamefreak not knowing game balance. I don't think they'd do something like that intentionally for this narrative lol.
It's also extremely hard to believe the argument that Johto is lagging behind technology advancements when they use the exact same, if not better, Kanto systems. The pokémon center got upgraded with extra areas and a better PC, they have a whole train system going on with Kanto, a radio tower, a brand new phone system that connects to it and shows you the map, hell prof. elm's lab literally looks like an upgrade of oak's. Just because the region focus on maintaining its culture instead of assimilating to Kanto's urbanization, doesn't mean they're struggling behind with technology. This is a mirror of the differences of real-life Japanese provinces. Some are more rural, some are more modern, but most enjoy similar technological advances available to them.
		
		
	 
I agree with your first point, but I don't take away points from GSC or HGSS just because GF didn't intentionally design them a certain way. The end result is what I'm mainly focused on, not GF's design philosophy. A lot of great innovations happen by accident.
You bring up some interesting points about technology. Looking at each one:
1. I don't think it's clear that the upgraded Pokémon Center or PC originated in Johto. As the GSC protagonist you see them for the first time in Johto since that's where you start. But those same upgrades exist in Kanto when you visit the region later in the game. We know these innovations mainly stem from Bill. It seems to me Bill is a Goldenrod native who does most of his experimentation and invention in his cottage north of Cerulean (ex. the teleporter). I think there's a high chance Bill implemented these systems in Kanto first only to later bring them to his native region Johto. But let's call this a wash.
2. The Magnet Train is not owned by either Goldenrod or Saffron City. It's inspired by a real life train that runs between Osaka and Tokyo, owned by a company that isn't affiliated with either. Again, you see this for the first time in Johto through the eyes of the GSC protagonist but that doesn't mean it belongs to or originated in Johto. You could argue it belongs to Kanto since they actually own the Plant that powers the train, but let's call this a wash too.
3. Kanto also has a Radio Tower which replaced the Pokémon Tower in Lavender Town. Again, just because we see the Goldenrod Radio Tower first in the games doesn't mean they implemented it first in the three years between RBY and GSC.
4. I don't see how Elm's lab looks more advanced than Oak's. Aesthetically they look pretty similar aside from generational differences. But maybe that's just me.
These all even out. What puts Kanto over the top for me technologically are three things:
1. Silph Co. - Kanto takes a massive lead in tech by having the leading manufacturer of Poke Balls, medicine, repels and TMs located in its region. Johto has nothing which even remotely compares. Oh and that fancy Pokegear you receive at the beginning of HGSS? That has a Silph logo on it. Interesting.
2. Fossils - Kanto builds on its lead by having the technology to resurrect fossils. That's pretty extraordinary. Johto, interestingly, is one of only two regions to not even have fossils native to its region let alone the technology to resurrect them.
3. Legendaries - Kanto closes the case for me by taking one look at their legendaries. Johto has Ho-Oh and Lugia, more or less the God of the Sun and Sea, respectively. Mythical creatures. Kanto has Mewtwo, a man made creation and marvel of genetic engineering. Hmm.
I think it's pretty clear Kanto not only blows Johto out of the water technologically, it might be the most technologically advanced region in all of Pokémon. Feel free to disagree.