I talked with Jesse Sky (Lead Flashpoints and Operations Designer) about the difficulty of Lost Island and its rewards, and he shared his insight about these questions.
He mentioned that Lost Island is balanced very tightly for a group in Tionese-quality gear, but that because the boss mechanics are heavily execution-based, many players prefer to overgear for it. Small mistakes can easily wipe the group, so bringing Ops level gear is great insurance, even if it isn't required. The loot quality reflects this - players who take the risk of going in with Tionese and Columi gear will be rewarded. Players with Ops level gear are likely there for the Black Hole Commendations right now.
I don't see any Tionese tanks surviving the last fight with Lokin too well (tank is gonna eat some satchels), so I don't agree the mission is designed for that level of gear. This mission is listed as a Hard level 2, so theoretically everybody will be in full Columi before they walk in. If the mobs dropped Rakata-level amoring, mods, and enhancements the loot would be better balanced.