I'm soloing exclusively on an Assassin, I chose not to use any Guild buffs or join a Guild. Neither will I make any Store purchases.
The Hounds at low level do seem to be able to hit pretty hard compared to the rest of the regular mobs, which makes sense as they are (Current Quest Level +2).
Personally I find them uninteresting and more of an unwanted nuisance more than anything else. As I tend to prefer to lean towards relaxed play rather than rushing towards the end... I'm not going to alter my playstyle for some short-sighted hound spawn mechanic either.
I have to go AFK occasionally - I can get called away at random - and with the daily occurrences of the ongoing
Chat Server connection issue, "(Error): The chat server is temporarily unavailable. Please try again shortly." I cannot really risk doing grouping. I'm having fun giving people advice in Chat channels when they decide to function. :-/
So my answers essentially are; the Fey Hunt Hounds make me less motivated to continue because they conflict with my playstyle. It's not so much their poorly implemented difficulty; albeit that could have been fine-tuned. It's the dreadful tedium of them repetitively spawning being a distraction - you don't even get a token reward for them dying.
I prefer diversity and tactics rather than just blind focus on power and damaging mobs or one button bashing. The Hounds are as appealing to me as: shooting blindfolded fish in a barrel. In other words they do not excite me in the slightest. :-/
I am one the people whom actually enjoy playing stealthy rogues with the game. I am meaning the "stealthy aspects" rather than damage output. Having the hounds materialise doesn't seem like its beneficial; for stealth play (what a surprise).
In fact: I have decided, I won't bother continuing to quest in Hardcore this season after today, for the above stated reasons. :-)