I really doubt that the aiming reticle on that launcher is functional. If it were functional, it would come with a deployment movement penalty, thus rendering the launcher useless.
The severely reduced splash was the only way they could make this happen without massive no-skill demo whining.
I doubt many pyros will be reflecting these rockets without a reflect-hack. I believe 80% faster puts them somewhere between flares and arrows? It seems like they'll be as fast as flares, and very few of those ever get reflected. Besides, soldiers already have trouble with awesome pyros, while owning crappy pyros.