It's not so much a redesign as it is a realign. Things were getting cramped without room to grow. We're not trying to "dumb down" the interface (although it should be simple and effortless to use) and we're not trying to cater to new users or alienate old school LJ users (that would be stupid). Our goal here is to make LJ simpler to use considering our advanced features which have been hidden by cluttered or inadequate design. That said, a lot of what we do is based on user feedback and we're working on making changes to address them.
What we've fixed so far
We just a released a newer version of the update page with some very minor fixes. The entry form no longer gets too wide and we fixed a horizontal scrollbar issue on lower resolutions. Font sizes have been increased, the autosave draft notification has been moved, and the options now have a gray background. Some issues with the rich text editor have also been resolved. For a full list of fixes, check out this post in lj_releases
What are we doing next?
There's an obviously strong attachment to having userpic selection below the entry amongst other things and that's understandable. While we will not be offering an option to switch back to the old version, I hope we can work together to make changes and improve what we now have. Please understand that we love you guys and admittedly, we sometimes do things without fully understanding what the community reaction will be.
We'll be making small changes to the update page over time based on your feedback. I'll keep you updated on our progress in this community where you can voice your opinions as well.