It's funny because imo, for the purpose of the War Islands, I'd prefer communism, and it can't even be changed back, because it was abandoned when the WI sanked. So it's more that the backpedalling itself is funny (not that it's bad, please continue supporting WI).
To explain, I don't like estates on WI because it creates a lot of internal conflict, which is (bleh) fine for normal islands, but tiresome when you're just looking for fun and slaughter. It also makes attacks on / fortifying with militia in a particular region drain the income of just one lord and a few knights, who are then reliant on gold handouts. This makes the game miserable for them, while everyone else (understandably) avoids the issue. It seems that having your region on the front line should be, if not a fun experience, at least well funded and important, instead of bankrupt.