It's better VS T2 Navy because the splash will frequently take out multiple ships, doubling or triple the effective DPS. It's also much, much tougher to dodge. I'd rather throw a Tempest behind an established Destroyer fleet than 2.5 battleships, because it can launch shells from well out of range, and if one just *happens* to land right, which happens a fair amount in my experience, you just killed 3 enemy Destroyers in one shot. It also OHKOs Bulwark shields.
It works well paired with Torrent because Torrent is actually fairly poor at willy-nilly destruction of all the things. It's fabulous for taking out individual things (Shields, SMD, SML) but Tempest is much, much better at, once the shields are down, wrecking everything underneath. Buildpower, for instance. Or the power grid.
Having the factory built in is never a disadvantage. The 'downside' you mentioned only applies to idiots. Of course you're not going to sit it still and build when there are things around which can engage it! However, while there are NOT such things, you have the option to do so. That's only ever a good thing.
I'm not disregarding anything. I'm presenting logical arguments that this unit is not as bad as people think. Again I direct you to the Sparky, which is only now starting to see the play it should be given its stats.
If we WERE to change the Tempest to be a more general-purpose, often-seen unit, I'd buff the splash radius by a point or two, and the HP by a bit. Say 75K HP. Wouldn't want to push it too far. All while nerfing the buildtime of course, alongside the rest of the exps (Hopefully).