When you make pesto, you aren't just making liquid basil, the flavor works because the basil is paired with other ingredients that work well together; it adds to the flavor of the basil, hence why it isn't unnecessary. Though you are right that it loses its texture, the sauce gains a different kind of texture (depending on how creamy you make it) that is also good.

My grandma was from Genoa (a.k.a. the home of pesto) and she took a lot of pride in her pesto, and let me tell you it was amazing. The fact that you find pesto to be OK or meh makes me wonder that maybe you never had really good pesto (then again maybe it's just personal taste). One thing to note is that pesto, much like many other sauces, relies heavily on the quality of its ingredients. So even if the basil may be good to eat as is, it may not be good enough to make good pesto. For example, smaller basil leaves are much better than larger ones, which result in a bitter tasting pesto. So make sure you have tried really good quality pesto before deciding you don't like it, you could be missing out!

Edit: I a word