I think there's a bit of a lack of understanding regarding the purpose of reckoning here. It is useful for "taunting" mobs, but this was only a small part of its purpose (because ideally, if it were just a taunt, that's what we'd use -taunt- for.)
The reckoning skill was also designed in order to finally give paladins something to prevent others from running away or just staying constantly ahead of us range wise- as before reckoning, if you could get away from a paladin for even a moment, there was nothing they could do about it. Paladins have no skill to increase mobility, and the only "range" we had were fishing polls (try using one of those skillfully while running and lagging.) As such, we were given Reckoning to pull in those who would run away and slow them down to stop their easy escape. We're now no longer at the complete mercy of casters and rangers, who before could kite us, and our only options were to run, or die.
The range is required to even the odds against ranged characters. The slow helps stop people who are running, and force them to fight. The damage... is actually pretty insignificant compared to the rest. Bash does more, and a paladin's sword does only slightly less (though, swinging a sword costs no mana, has no warm up and no cool down.) The slow effect is consistent with other classes- spells like root stopping them for 4 seconds, terror slows for 6 seconds. The main difference is that this happens to work in an AoE sense, making it useful in party vs. party combat (which is what the paladin is slowly being geared towards- they want it to become a utility class.)
Now, let's take a look at the changes proposed here.
Reducing the range: makes this skill worthless for stopping those who stay at range and kite. If we can get up close to them for a moment, sure, we could use reckoning and slow them down, but that's only if we get close enough in the first place, meaning all a caster/ranger has to do is stay five blocks ahead, or slow the paladin with one of the many skills they have for exactly this purpose. We're back at square one and at the mercy of ranged classes, unable to fight back. We note that a wizard's range for root is 10+0.1 per level, meaning by default almost as soon as a wizard has root, they can stop a paladin in their tracks without ever being in danger. Reckoning IS still one of the widest-ranging AoEs, and I think we could safely bring the range down to 7 or 8, but lowering it much past that would drastically reduce its worth.
Lowering the damage: 3 to 4 damage is an absolute joke. If we were to do this, we may as well just remove damage altogether and just put on the slow effect. When going through the wiki and looking at all other AoE skills for level 60 specs, Reckoning actually has the lowest damage, of all the AoEs that deal it, since it's only 75 damage.
Removing the ability to hit through walls: It's magic. I guess I don't have much of a counter to this, but all AoE do this, as you pointed out.
All in all, I think reckoning itself is in a good place. Could paladin stand to have other changes enacted on it? Yes, I think there still needs to be a balance worked out. But Reckoning, in my opinion, is in a good spot.
TL;DR- reckoning is one of the lowest damaging AoEs, slows as long as root stuns, and its range, while it could be tweaked one or two blocks, it's otherwise in a good spot. It also makes it so paladins can actually fight against ranged classes rather than fleeing or dying.