I find that the hybrid regen/medkit system used by games like FC2 and Riddick is a decent compromise between the two extremes. Sadly, it doesn't get used very often. It's much easier for developers to just use full health regeneration, as they don't have to worry about designing and balancing health pickups. Full health regeneration is also more appealing to casual gamers, of which 90% of today's market is comprised. Casual gamers don't want to be challenged and they don't want to be forced to think in the long-term or improve their own skills. They just want to sit on the couch, play their user-friendly consoles and relax.