Sword above head is quite common ACTUAL Hema pose - from real fighting. Not everrything is Aikido you know? And europeans definitely didn´t use japanese fighting techniques lol.
About speed of combat - as somebody with many hours of combat in KCD, I can tell you that it is fast enough. Sometimes, when your RPG stats are too low, its even TOO fast as you have basically no time to react and everybody except for few 15year old SF or MK hardcore player will get their ass kicked.
The thing is, that KCD is RPG, NOT combat simulator. So speed of combat is dependent on your stats vs enemy stats - if you are more skilled than your enemy, enemy seems slower - and in this game he will actually be slower, giving you more time to react or bypass his defense. So believe me, if you try attacking trained soldier at the start of the game, he will be so fast that you wont even see the blade which just chopped you to pieces.
Issue with overall speed is of course simple:
In real life, you relly on your training+instincts + you have instant reaction: Eye->brain->muscle. With good training it even goes eye->muscle.
In game, you have many delays, slowing your reaction time: response of the monitor->eye (eye detection with lower FOV is also slower!)->brain->muscle->keyboard/mouse->game reaction time.
KCD devs TRIED to implement combat at full realistic speed, but nobody was actually able to do anything. But believe me, in game it actually feels quite fast.
As for lock on: your proposed solution is some random kiddie bullshit. Actual strikes and techniques are not just simple “chops”. You chop grass or trees, but you don´t chop armed enemies, thats just retarded. Thats why lock ON is important, it allows more control of combat. You can change your enemies by scroll wheel, or you can press shift to unlock and lock to new enemy at any single time. You can of course also block/parry/hit enemies that are NOT lcoked on currently, you just wont have that visual cue in your crosshair to enhance timing.
Stamina is also rapidly regenerating, and it doesn´t substitute overall energy - when you run out of stamina, you are not going to lie in mud unable to move like after marathon, it just means you unleashed all your acumulated energy and need to catch breath before doing it again. You probably also can´t swing 5kg hammer for 20 minutes in row with the same intensity. (I bet most people can´t do full powered swings even for 30 sec in row). Thats what stamina represents.
When stamina is low, it represents that you have lower control of your body, that means that even strikes on plated armor can hurt your muscles by impact force, shatter your bones, disclocate joints etc - thats why you take damage in this case - but be aware that even in this case the damage is much lower then if you are not armored at all. You can become literally walking human tank, when only the heaviest blunt weapons can do any substantial damage to you, unless you fuck up badly.