It really needed cut out about 45 minutes worth of pointless relationship/"character development", only because it was poorly, poorly done and significantly soured the film.
You are so right. Lucas spent so much time trying to establish the 'fatal flaw' of this character. To no avail.
Luke's turmoil dealing with his heritage was done pretty well IMO. Again, that's from the perspective of a 5-9 YO kid.