Lao isn't that great either, many other characters have strengths where he has obvious weakness
No wakeup
bad buttons
poor hitbox on spin
poor frame traps
wacky backdash and walkback speed.
bad strings in general
bad J2 which even whiffs on crouching characters, pretty hard to use
uneeded nerf on s1
While Hat Spin and Hat Grinder can mask some of the neutral weakness by ending anything bad with them to make him look good, KL can't defend himself much from characters who approach as fast as Cassie, Kotal etc.
And Hat Trick who can't mask his strings with anything ends up being worse, as a variation only played by a few.
He falls and he is done
Before ex spin was really a god send, since it conditioned ppl to watch out to when or where to press buttons, which in turn would gave him a sort of mental frame advantage, and a good wakeup option.
This is gone, and left a pretty big hole on his gameplay imo, NRS could easily fix this by giving him a better backdash, and a better walkback speed, this would compensate for his lack of defensive armor with being able to be even more mobile while on the ground, and easily space normals, and mixups while he is standing.
Hat Trick since its the weakest and he is even more minus than the rest, reducing 5 frames on all his frame traps would make his combos more easier to pull off, he would be at -1 at the best on neutral instead of -6 at best or worse which makes him wide open anything, it would frame trap 11f mids with a call back or jab, giving him the mental frame trap and his call back should also be reduced to -5 instead of -7 giving him +8 frame traps in the corner
KL doesn't need more special moves or super crazy changes like a new low combo starter or faster overheads starters or safer, in general i think the fewer things he needs is walkback speed buff, and backdash buff, this would buff, tempest and buzzsaw neutral, and hat tricks specific buffs would make him on par with the rest and have 3 competitive and viable variations, along with the things
@REO already put as suggestion. Without forcing KL to jump all day to bait moves with dive kicks,, spacing or teleport for random reasons.
So the issue its not really he being free on wakeup, its the work he has to put on to not get knocked down, its just not fair compared to the less risks most of the cast takes to win and many of them still have a reliable wakeup, KL is lacking in both departments which makes him kinda weak and not really worth the effort since mostly everyone even if not as good at least they either need to work less or have a better wakeup...
just my 2cents.