I think for a kid's series it would have been hard to keep kids into it had several characters died in the middle. Let's face it, Remnants didn't do that well. Other famous series (Harry Potter, Artemis Fowl for starters) all manage to keep most of the main characters alive. Animorphs was at least real enough to take one of the ones most precious to us, one of the narrators. In Harry Potter there were characters you loved that died, but none of the main three. And the main three lived happily ever after. In Artemis Fowl... Sad, but not a main character.
For a kids series, it was plenty horrific. People shot, entrails falling out, PTSD, people willing to run out of the war in spite of the damage it would do to civilians just to not be in it anymore (MM#4, The Andalite Chronicles), treachery, a loss of morality, tearing family apart, torture... I could go on pretty continuously about it.
From a first-person narrative I can understand why there weren't 20+ characters from the beginning. And losing a narrator! I always wonder what my cousins will think when they've read the series just to get to #54, and the character that always came right after Jake dies. Someone from the beginning, someone they got the thoughts of in every Megamorphs and 1/6th or so of the overall books.
Heck, I was starting high school when #54 came out and I remember my friends and I thinking it was so traumatic. You didn't need to be a genius to realize how much worse real war would be and how many people you would lose.
I think if, reading the series, there had been more narrators, people dying, etc., etc... A lot of kids wouldn't have even bothered, because there wouldn't have been anyone you could fall in love with. I don't know if even I would have bothered. Now, as an adult, I think I would. But back then? The whole point of a novel series was to have home characters you could come back to and be in love with. Speaking of literary love here, of course.
So, unrealistic? Yeah, quite a bit - especially considering their ability to make it as long as they did without Ax. A stupid decision in execution? No, absolutely not. For 9-12 year olds I think it was totally the right choice. Get them in love, get them to feel that comradeship, rip their heart out and show them the harshest war reality at the finish line.
Didn't like the final arc of the series, but speaking purely of how it ended I thought it was pretty smart.