It served two purposes. One was to add onto the gating system to kill time, the other was the fact that the encounters do get much harder when you can't sit there and faceroll it repeatedly until you get it right. With limited attempts, it requires careful planning and raid awareness as not to waste tries. It makes for a mini-hardmode so the high end guilds had less to complain about since they didn't have actual hard-mode access yet.

Most "casual" guilds were not the people who were going to be downing the new wings within 24 hours of release, the limited attempts was geared especially at the guilds who were. Now that most guilds of that caliber have already unlocked hardmodes or will within this next week, the removal of the normal mode limits is purely to HELP "casual" raiders out.

As for the LK difficulty, remember that his very first 10 man downing was from a hardcore 25 man guild, meaning that they overgeared it hardcore, and therefore it isn't a "true" 10 man kill. Also remember that he has gone down on normal mode only, which is geared for casual players, not the hardcore guilds that have downed him.
It's much more of an achievement for a casual 10 man guild to down him in a month than a top 5 raiding guild to down him in 12 hours. Plus, these hardcore guys are looking to hard-mode LK anyway, which should legitimately be a challenge.