"Useless" is addressed to shield dedicated paladins.
They posibilities are limited and most of the time they
just spam wrath. I personally find them boring to play.
But it does not make them weak.

Just imagine a fight. You with your average gear and without preps
and me with my uber gear (damroll 70-80) and without preps as well.
Would I have any chance to win? Doubtful.
You would just feed me with wrathes for obliterates each round
and dodge my skills with temperance.
Somebody may call it well balanced, I don't.
Do you realise that every time I won a fight against you
it is because I used additional preps and money for healing
while you used just your own skill/communes.
Would you use the same preps I used I wouldn't have any chance
against you. Not much I can do against temperance paladins,
some of my skills become useless because of champion stand
and other become unreliable because you dodge them.
If you noticed, most of the time I didn't even initiate a combat
with you letting you to start with wrath on me, because else
I would just eat your counterstrike.
And it is not because I was a duergar warrior. Basically
every melee class would have the same problems. Orcs, thieves,
rangers, warriors.
Yes I'm aware that against neutrals wrath does not work,
but when it comes to two-handed paladins they do fine against
neutrals as well.
When a storm two-handed paladin says that without virtues
he is weak because Joe Blow bashed him to death I can only laugh.
Giants are not the best target for bashes. Quaff enlarge?

When overpowered barriered invokers tool me they at least
have to prepare and find that barrier wand.

It can be argued that paladins can't finish their enemies,
however they are hard to kill as well.
You didn't kill me, right, but I didn't kill you as well.

As a variant how to balance paladins:
allow them to use both dedications: two-handed and shield
but take out virtues or tone them down greatly, like legacies.
For example, when a paladin comes to fight a basher he can
wear a shield to protect himself and when he is going to
hunt somebody, he may switch to two-handed weapons.