I don't disagree with anything you've said here, but we shouldn't think that the current system and the articles of confederation are the only two possible systems.
There may be a way to transfer a significant amount of the federal government's authority to the states without incurring the sort of chaos seen by the confederacy in the 18th century. Or maybe not, but at least it's not obvious.
Either way, the current system leaves most of us disenfranchised in a lot of ways that a less centralized system would not.
We're disenfranchised in the current system for other reasons. One is that the country is simply too big, and two is that there's a huge rural/urban divide in culture, and it's growing. Giving power back to the states isn't going to fix that. First of all, the states' borders are not drawn to reflect different groupings of people. I already mentioned how many modern cities span multiple states. NYC spans at least 3 states! Giving more power to Illinois isn't going to appease the rural voters there, because now the Chicago voters will have even more power over what happens in rural IL; if anything, they're going to be much angrier. The Federal government, by design, gives disproportionate power to rural states, so rural voters everywhere benefit from this, to the detriment of city-dwellers.
If you really want something closer to a confederacy, the first step is eliminating all 50 states and redrawing all the state borders. But this isn't going to work well either, because then the rural people will want their own, separate states. But then after a while, they'll find out that their states have no economic power at all, and can't even provide basic services, because there's insufficient population and tax base to do so. So they'll effectively turn into 3rd-world countries, and people will empty out of them even more into the cities, if the city-states don't clamp down on immigration.
If you want to see examples of countries where they have both urban and rural populations, and very little internal strife, these places exist now. They're in Scandinavia. They don't need to separate the urban and rural people into semi-autonomous regions to get along. But they aren't big countries with hundreds of millions of people either. And they're very culturally homogeneous, something we just don't have here, and likely will not any time soon, even if you just look at the dominant caucasian population: there's very little similarity between the cultures of Trump-voting white nationalists and urban liberal Millennials, and the two actively despise each other and want completely different things as far as government policy.
There may be a way to transfer a significant amount of the federal government's authority to the states without incurring the sort of chaos seen by the confederacy in the 18th century. Or maybe not, but at least it's not obvious.
Either way, the current system leaves most of us disenfranchised in a lot of ways that a less centralized system would not.