TLJ had the unenviable job of reconciling the characterization of Luke in TFA of being simultaneously a mere man with some Force power and also the most dangerous and powerful person in the galaxy, capable of singlehandedly saving or destroying empires.
I think making Luke into the cantankerous hermit he became is a fairly deft way of solving the problem, since it’s still imperative that Luke not take up too much of the air in the room and leave some for the new cast. Sure, it makes more sense for this Jedi Master to be actively working on a new Jedi Order but the same could be said for Yoda in ESB.
The problem of Luke is one of JJ trying to have his cake and eat it. Luke can’t simultaneously be the savior of the galaxy in perpetuity while also allowing the new heroes to shine. Luke’s death in my opinion was the first chance for the ST to really stand on its own creative feet, and it should have happened in TFA like the death of Obi-wan. Of course JJ couldn’t write an ending to Jenga so we got TROS, but the chance for greatness was there, set up by Rian’s necessary choice.