The horse is actually more than just bad looking. From what I heard (didn't bother to test this) it also no longer opens its mouth. Which is a serious decrease in functionality / game mechanics. It was part of the horse and what defined it. Horses make noise, and they do stuff. Sometimes opening up their mouths.
That iconic detail has also been removed (so they say) and if that's true it's seriously bad for the overall game I think. Sure, it's only a small detail, but an important one.
But then, after a while nobody minded the new combat system, because it wasn't actually bad, it was better than the old one, AKA the click mashing contest.
That is actually not quite true. Many players simply gave up on upgrading entirely and stuck with 1.7 or 1.8, you can see this yourself when looking for very specific PVP servers; many still run on older versions. The same applies to some plugins as well: some are only usable on 1.7/1.8 (also with a pvp emphasis) yet despite that they're still being actively maintained (so we're not talking outdated plugins, but plugins specifically maintained for 1.7/1.8).