For some of the industries I think the variety is welcome. For example, you can still use planks to make tools (vanilla) but you only get one tool per plank. If you use steel for tools, you get two tools per steel.

But in the example you site, I agree it doesn't make sense. 2 iron + 2 coal for 1 steel is strictly worse than 2 iron + 2 coal for 1 steel AND 1 slag. My preferred fix for this would be to reduce the vanilla factory to 1 iron and 1 coal for 1 steel. Or, if the mod author feels the original ratio is balanced, then requiring 3 iron and 3 coal for 1 steel and 1 slag in the expanded industry.