None of this is true my friend, if you pick can pick one Variation and play just with that, that doesn't take away from the other Variations. It just means that this particular Variation fits you the best. If you one Variation from 2 to 3 chars, you can pick the right Variations for you with the minimal amount of difficulty for you. And you're not playing you're self at all, that's like saying you're playing yourself when you pick between 2-3 chars in a gave without Variations. But with Variations, you can make sure that the ones you pick fit you the most, so it only contrasts that. And as for picking 2-3 Variations from the same char, what you said can be said for a game without Variations regarding balance, and it doesn't matter if it's rare or not, it is still a valid option and it can be seen on several occasions.
The Variations are very well balanced, even if some are not used as others, just like that in other balanced games with no Variations for the chars, some chars are less used, so just like you can't say that about that game, you can't say that about MKX.
Also, I'm sorry but you can't disqualify an entire system just because of one char that you in particular it didn't work for, especially if you really didn't play MKX to the fullest and stopped playing it before the final patch, because that shows that you didn't investigate enough regarding your char, in this case, Liu Kang. I'm sorry if sounds like a jerk, but I for one not only investigated a ton of stuff for Reptile and the game in general and I still find stuff even after IJ2 was released, but I also don't judge an entire system or a game on the basis of just one char. That is just wrong and indicates a very narrow point of view. Even if I would've play a char which I don't think the Variation system doesn't work, I can't disqualify the entire system because of that char. Not to mention that even in the example of Liu Kang, you're still saying that only one Variation isn't good, but the other 2 are. So even on that token you can still have the Variation system but only with 2 per char. So your whole example only becomes even less valid. No disrespect of course.
I think that the quantity of Variations in the game give everyone the illusion that the Variations hurt the balance, but the system in itself is really a great system. Yes, having 100 Variations, which means 100 different chars, is almost impossible to balance, but 1) NRS did an excellent job at balancing the game, and 2) you can have a game with 100 different chars and you could've face the same problem because of the quantity of chars, while also still facing the issue that your char of choice will not fit you gameplay-wise and you need to look on the entire roster of 99 chars just to find another char that not only fits you gameplay-wise but that you also like as a char. That is why I've said long ago that all you need is just reducing the number of Variations per char to just 2, and then not only it will be a lost easier to balance, but you can still have more then one option to play your favorite char while also making more room for different chars. So if MKX had 32 chars with 3 Variations each and one more with 4, MK11 can have, let's say, 44 chars with 2 Variations, maybe even with one more that has 3. And then there shouldn't be any problem.