I know you're not exaggerating; a full range Nidalee spear DOES in fact take around half of the opposing ADC's health away... not that any of it matters because of his lifesteal and what not. The juicest target for Nidalee is actually the mid laner most of the time, because he can't sustain back up.
Thing is, your hypothetical situation isn't what nidalee is. You gave me a hypothetical situation in order to be like, "See, this is what Nidalee is," but it's quite simply not. Nidalee, in order to kill her target, unless the opposing enemy isn't chunked already, has to go in to kill her target. This is why she falls off SO HARD late game, because you simply CANNOT jump into a teamfight as an initiator and kill someone, unless your going for more of a bruiser build, which at that point, you don't have enough damage to kill the opposing carry yourself anyway.
Nidalee isn't completely useless if she's not snowballing either. She has her heal and her W which gives vision, which is one of the reasons she's played in the lcs.
As for the invisible spear problem, never have I since I've been playing this game dealt with invisible nidalee spears. Granted, I started playing after the problem was solved... my first ranked season was 5. However, it's no longer an issue, and I've played against a lot of Nidalee's. This bug people complain about is their idea of an excuse to gut her. And, if she's tossing spears out of the Fog of War, unless it's laning phase, your team is the one playing chicken with her in the jungle, which is a place nidalee thrives. That is your guys misplay... I can't stand it when my team chases nidalee in the jungle for this reason and the amount of back pings I throw down on the map is immense.
If she lands a full range spear, you deserve to lose most of your health. It's incredibly hard to hit. This is the same reason Morgana's Q has a 2 second snare time and what not. It's not only because of the nature of it as a spell (snaring someone in place from a range) it's because it's a medium ranged skillshot that is slowmoving.