True, it isn't any less broken than that; it's more broken.
First, adding a third-party repository, and then using your distro's GUI package manager to install an app from that repository, is a lot more work for the average user than clicking on a download link and then dragging the downloaded file to your desktop (or clicking on it to open it and start an install process). That's by design: it should take some work on the user's part to download and install software that hasn't been vetted by their distro. Greatly reducing that work, as Flatpak does, is a bug, not a feature. (See further comments below.)
Second, third party repositories don't promise that their apps are sandboxed; a binary from a third-party repo has the same privileges as any other binary from the distro. Users aren't being told that the third party apps are "more secure". Promising that your apps are sandboxed means they need to actually be sandboxed; disabling the sandbox with default privilege settings breaks that promise. So users get less security than they think they are getting with this model.
> Linux is secure because nobody can ship software on it without going through massive hurdles
Really? Then why are there thousands of open source applications in my distro's package manager? (And that's without installing any third party repositories.)
> everybody who is smart enough to install software on Linux does some diligence.
Nothing can protect a user who is not smart enough to do some due diligence before installing software. So setting up the system to require some due diligence seems like a better idea than removing the due diligence just because users will find that easier, and then claiming that you can still provide security.