Thanks for the really thoughtful comment and feedback!
I agree there's a ton of room for improvement. Showing the guessed letters during card selection is a great, simple piece of feedback that makes total sense.
Disincentive to use second action & the "reveal first letters" card would both be alleviated by a feature I had planned but didn't have time to implement, which is a button that would let you "burn" a card to get back energy. That way, if you had cards to spare, you could use a powerful card, and then discard a common one to get a chance to make a guess. That in itself might require some balancing too, but I think it would help.
As-is, the only time you'd really want to use the "reveal first letters" card is if you rolled the "Extra Energy" bonus at the start of your turn.
Anyway, I don't have any plans to work on this any more at least for the time being, got other projects to get back to, but if I ever revisit it in the future I'll definitely take this feedback into account!