I personally prefer lower levels because at that point in any game every little thing can have an impact on your success or your failure. Once you get enough skills and abilities you don't really have to worry about having the proper tools or consumables.
I don't mind the level cap being relatively low, what I do mind is the absence of progression because it makes things feel pointless.
I went through all the content in the first Pillars and ended up reaching the cap with plenty of content to play through and it is true that it tends to shift the focus from the character to the gear and loot while making choices less significant simply because you have gathered so much resources that you can get the stuff you want anyway.
Managing the endgame is always tricky and there are some good ideas in this thread.
My favourite model is the open one XP model like in Fallout 2 in which the cap is so high nobody can ever get there without cheating (unless they've been playing the game continuously for the last 20 years).
It's funny that some players actually enjoyed the cash register sound from Fallout 3 (and 4), that's probably the first thing I got rid of. I don't mind having some cues but that was just too much of an immersion breaker.