I think you could still say it represents a bit more than that and I'm tempted to go into more detail about it. But the thing is, here you're making it sound like the "accidental mass genocide" which, for the record, was part of the later stages of the first season, was directly followed up with Milly's antics as per R2 5 or R2 12...that's not exactly a fair representation of the situation if you ask me, especially if any and all context is left out.
That plot thread was taken in one direction during the first season and had a clear thematic outcome during the same. The surrounding situation changed during the second, that is clear, but even so, that plot thread was still present, just as more of a background element, until it actually re-emerged under very different circumstances. Yet it still played a role and had a purpose in the end, in spite of everything else, so I don't think the Ashford episodes undermined it or anything.
Or, like some of us can and do argue, somewhere in between. I'm not an "all or nothing" person though and I suppose this is well reflected in my interpretation and analysis of this show. Whether that really was such a "bad" thing is up to each person and what they could (or couldn't) take away from the series. It could have been better, but for me it didn't amount to "nothing" in the end.
I'm of the opinion that the entire first half (1-12) could have been shorter and didn't really like the China arc that much. On the other hand, on re-watch I actually appreciate 6 and 7 a lot more, so there are certainly different ways of looking at this.
The late night slot allowed them to get away with actual nudity though, not just once but at least three different times from what I can recall, so that would have to be a relative moderation.
They couldn't actually do that on prime time so I suppose that's part of why we got more of the standard kind of fanservice instead, since someone, either the executives or the staff, felt it was needed (to attract more viewers?).
It's true that fanservice is still present throughout the show, but I'd argue most of it is concentrated around the first half of R2, with episodes 5 and 12 still being the biggest individual offenders, if you want to put it like that. It didn't disappear after that point, but at least for me, it was barely an issue in comparison.
Let alone compared to, say, the amount of cheesecake in a series such as Godannar (which IMHO is pretty good regardless).
As admittedly funny as this is, there's only like one exposition scene which vaguely reserables what you're describing, near the end of R2 11 in fact. I don't think it actually got in the way of any of the more important dramatic moments though, just in case someone cares, but you never know.