Bending being downplayed like that irked me as well, but I've got a hunch on why it seemed so weak in LOK compared to LAB. We already know that the next season will be about spirits and the spirit world. Clearly, this rapid advancement of technology in their world led to a steep decline in spirituality. Because the benders of this era don't value or even remember the spiritual aspect of bending, it has resulted in weaker bending overall. Sure, we do see an increase in "advanced" benders with metalbending and lightningbending, but that's simply learning the technique. They're just going through the motions without understanding why these motions create lightning. The world wasn't any better off having an almost strictly physical avatar that barely understood the spiritual aspects herself. Though, maybe the avatar is born with qualities that reflect the world he/she is born into.
But, like you said, it's possible the LAB main cast were all prodigy benders and we're actually getting a look at average level bending here. Also, as the world becomes more modern, benders will have to tone it down a bit to avoid unnecessary destruction. Like when Korra caused all that property damage in the first episode and everyone involved would have rather the crooks just gotten away instead. But it would be nice to see something more creative than "telekinetically lift rock, launch rock at bad guy." I'm just hoping that in season 2 Korra works to restore spirituality to the world and we see some truly awesome examples of bending. Like when Katara fought Master Pakku... damn that was an impressive fight. In the LOK era, 2 waterbenders fighting will just shoot jets of water at each other. Whatever happened to specific techniques, like the octopus or the water whip?