Hello.
TL;DR: Yes, the quest / monster level system is bad, and I think it needs a complete overhaul, don't care how, just not like it is now.
First off, some background about my game experience: I reached Novigrad at level 13, playing on Death March. Currently started a fresh run, for reasons I'd rather not go into.
I had a ton of problems with the levels in my first playthrough. So, I just finished the prologue, and I went around to finish all the undiscovered stuff I had. One of them was in the middle of the lake. Went out for a swim to get my phat lewts !, was about lvl 3 or 4, and about 3-4 drowners level 10 facefucked me so hard underwater I think I might've developed hydrophobia.
What the hell. I had to kill them off one by one, while kiting them around and swimming away when they got too close, shooting for about 10% of their HP with my crossbow. THAT was a nightmare.
Then I reached Velen, hoping that stuff will be balanced around. Now the idea that progressing in main quests may screw up sidequests, I decided to do some exploration first, do some contracts. So I went for the nearest inn, and oh was I bummed out, first contract in Velen, level 33.
Anyhow, I somehow managed to survived other sidequests, levels far higher than me, including a 15 minute fight with a Wyvern level 14 when I was level 7. Then I got to level 13, and after clearing most of Velen, except the level 20+ stuff, I went for Novigrad. That's where my journey ended and I started fresh, partly because realizing that these quests will be faceroll at my level and gear.
Conclusion:
This was a really bad quest and monster design. I don't mind a challenge, in fact, I love it. I play all my games on the hardest difficulty. But running into quests / enemies / monsters that are 3 times my level is a bad design. I love the Skyrim difficulty system. Most, if not all, quests and monsters scale with your level. This is how an open world RPG game should be, in my opinion. You choose hard difficulty ? It will stay like that.
I expected hard fights all over at the start, and expect them to get harder the more tools [abilities], levels, and gear I aquire along the way. I'd rather not see what level monsters are, or what level quests are. I expect the difficulty to be hard / harder depending on gear and level, and without stuff being impossible / facerolled cause hey, I overleveled that by mistake.