Most of these points are met by the re-work of these that has been worked on for months as part of the citation work – see http://mediawiki.org/wiki/VisualEditor/Design/Reference_Dialog but broadly a much simplified version of the full transclusion dialog is being made (provisionally I'm calling it the template dialog) which removes the TOC and makes a lot of other changes.

There's also bug 53604 which tracks improvements in general; should we factor out the unique parts of this bug (not quite sure which)?

(In reply to Derk-Jan Hartman from comment #0)
> I find the whole thing to be rather confusing. It's much too technical. Also
> it partially mixes the concept of ToC with that of a structure editor. It
> has some widgets on the ToC (add template, add content, change order) and
> others inside the editor (Add param, del param, del template). This is
> terribly inconsistent. And makes you having to scan the screen too much.

Add param – moved to ToC for transclusion dialog, and to bottom for template dialog.

Del param – currently being left on each param; we could move it, but not sure where?

Del template – will not available in template dialog; being left in place right now for transclusion dialog.

> Also by default it tries to introduce you to the concept of chained
> templates ( starttemplate, content, endtemplate ). Which is rather complex
> and often not even needed.

Indeed, hence the split.

> This needs serious work to make the usability much more consistent and
> predictable.

Which is why we've been working on this for months. :-)

> I would take the following into account.

> 1: Make a decision. Is it a toc, or a structure editor ? If the latter, then
> put all structure controls in the structure editor. Otherwise avoid putting
> them in there.

See above.

> 2: By default, don't show the buttons for chained/wrapping templates.
> Instead, only add them if Parsoid assumes there is content wrapping
> happening.

See above.

> For new templates insertion, make an addition to templatedata
> "openedBy, closedBy", and only add the buttons if the template data says
> they are needed.

This is a nice idea, though it could get very complex ("this template can be opened by these four templates, or these two templates in conjunction, but not following this template, except on Category: pages, but only with language conversion switched on, unless it's a Tuesday…").

> 3: Keyboard control. I try tab key to move focus to the "Add template"
> button next to the field. Seems this is captured by the UI, so I cannot move
> focus that way. It seems I can only click the button. BAD... Also seems that
> the add button and the delete buttons do not have a :focus state. Or rather,
> it seems that buttons have focus state, but the focusable element is the <a>
> inside it, so it doesn't really work.

Yeah, there's some bits of keyboard work that need improvement, and the tension between accessibility and utility is acute here.

> 4: The layout of the params view.. I don't know how to do it better right
> now, but this needs work. too many lines/blocks, it's too cluttered. Do you
> need a double line separator if you have a heading ?

See https://commons.wikimedia.org/wiki/File:VE-reference-dailog-design-05b.png