Why is the inventory so bad?

I think the inventory is fine.

Item graphics are nice and big and actually give the item some kind of identity, rather than just being a bland vessel for bigger numbers.

The aesthetic value shouldn't be undermined. I would even put it above the whole inventory management thing.

Inventory option are in the next patch.

I like the feeling of size of the items. When my ring is half the size of my polearm.. something seems wrong. Plus. You get cool graphical art to store there.

I adore grid inventories and I wish more games used them. Even in games where space isn't a huge issue, I love them. You get huge often detailed artwork of items instead of a small icon otherwise. It also helps give items a sense of size, and it forces you make choices regarding what you take back.
Look at all those fancy items! Faaaancy!