I wholeheartedly agree. Xianxia is in some sense a (male) power fantasy. Getting stronger by luck only to become a bully themselves. It has the notion of revenge of the nerds. And the farther they go the more ruthless they become. You could say they just adapt to the merciless world they live in but this explanation seems a bit lazy.
This was bugging me for years as well so I try, in my own novel, to humanize cultivation. What does it mean to become unimaginably powerful and do you lose your humanity in the process?
I would recommend the Chinese novel Ze Tian Ji. It discusses power imbalance a lot and what it means to cultivate (the philosophical aspect). It's one of the few xianxia novels that really emphasizes Confucian values. In that sense, it's more in the style of traditional wuxia novels.