I agree with the OP that the pet battles are fucking broken. This is comming from someone who has 430 UNIQUE pets and the Tamer title http://eu.battle.net/wow/en/characte...hoof/Pacer/pet (dunno why armory says I have 451).
Currently the pets you buy are way too strong. Their abilities are insane and the setup of the abilities are also too strong, while some pets have super strong skill a and b in slot 3, most of these bought pets have a super strong skill a in slot 2 and a super strong skill b in slot 3 which allows them to use 2 strong abilities at once.
Trainers are also way too strong for someone with a full level capped pet team. Im going to make a comparison to Pokemon because it is what blizzard is trying to copy and tbh it is a fun and balanced game. In pokemon your primary goal is to complete the poke league, the first time you get to the poke league your pokemon team should be averaging arround lvl 42-60 depending on which of the games you are playing. Once you have completed the poke league your pokemons get a lot stronger - up to level 100. That way you can use the poke league again to boost lower level pokemons with your now very strong pokemons. In other words, the trainers should be strong the first time you do them but get progressively easiler.
Pet battles are lacking that entirely, I cant boost low levels on the harder trainers, I need to use 3 lvl 23+ pets in order to take out northrend trainers and anything above. Infact on most of them I need to use 3 lvl 25 pets to take them out. I think this is perfectly fine if the level cap on player pets were higher (lvl 30) so that I later on could easily boost other pets by killing trainer pets.
I just saw that they are planning to increase the xp gained from trainers but that wont help anything when you cant use lower level pets against them.
The balance between types is also waaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaay off, certian types such as undead and mechanical (mostly undead) have an insane advantage when they revive after getting killed. Its fine that x ability does more damage against y type but those type specific traits are insanely unbalanced.
Another gripe I have is that you only have access to 3 abilities at once and you cant even choose the 3 abilities out of the 6 that ur pet gets in total. No instead you have a choice to pick either a or b in 3 brackets. Personally I think pets should have minimum 10 abilities to choose from and be able to use 4 abilities like in pokemon. Going from 3 to 4 is huge, one of your attacks will ALWAYS have to be a "normal" attack so with a cap of 3 you will only have 2 special attacks or 2 attacks that involves fun strategies.
The only thing I think is really well thought out about the pet battles system at the moment is the pet "Terrible Turnip" who is amazing for catching wild pets (cant kill enemies with their main attack), the only problem with this pet is that you get it far too late to actually use it for a long time. For referance I got it when I had yet to catch maybe 15 pets across all 5 continents.