Hey there, I believe the overhaul of the grab mechanic has some serious issues considering the current state of many other mechanics in the game.

Adding so much startup to regular grabs discourages either player taking action on round start RPS. The previous instant, no-whiff grab system was the only reliable way to counter the game's numerous defensive option selects as well.

Note that parry can be input during a block (on keyboard/hitbox, you can easily parry while blocking), and that backdash can be activated during the Stand > Crouch transition animation as well as jump startup for a micro-backdash (You can spam dash without needing to plink in this micro-backdash state too, which is pretty fun). Even if you aren't abusing keyboard/hitbox, since parry is not cancelled by any back input and has a greater-than-1 frame window, most defensive scenarios on wakeup can be avoided by first inputting an up-forward parry to beat meaty buttons and command grabs, and then inputting down-back + dash during jump startup frames to get an instant low-blocking micro-backdash which techs grabs, protects from lows, and pushes the opponent away should you block a delayed attack.

With the current system, keyboard/hitbox users can also invalidate meaty left/right mixups by blocking one way and parrying the other. Of course, there's still the matter of said users being able to hold left/right simultaneously to do such things as walk forward while blocking high, but one thing at a time.

Your only semi-reliable option for offense on wakeup right now is to go for a slightly delayed, completely ambiguous high/low mixup with highly varied timing to avoid "fuzzy parrying". Model priority changes when you tag out, so inputting a random overhead or low and tagging into an assist which is currently overlapping your character to hide which move you chose is one method. A delayed command grab if they attempt a transition cancel backdash after their initial up-forward parry would also work.

There is rarely any reason to land a meaty attack, as it will much more often than not lead to you eating a TOD unless the opponent woke up mashing and your delay setup was vulnerable to it.

Knuckles frame 0 unblockable supers are one way to make contact reliably, but are meter dependent. Otherwise, fighting with assists and projectiles seems to be your only choice to avoid taking unnecessarily high risks at the moment, though that seems to be at odds with your recent addition of an assist cooldown timer.

I would suggest returning frame 0 proximity grabs, but preventing them during dashes ala MvC to reduce accidental input and reduce the effectiveness of simultaneous grab+parry OS-based approaches (further reducing grab range would help as well). Otherwise, keep the whiff animation but speed up grab startup to be faster than a parry > L input (0-2~ frames?) so that it can be used at round start, reduce the tech window, and prevent dashes from triggering techs. If neither of those are to your liking, I believe you'll either need to incorporate a Third Strike-style parry system which necessitates the differentiation between highs/mids and lows, tighten up the parry window (perhaps scale post-parry combo damage to encourage offense?) and remove defensive option selects, or just remove parry entirely.

Cheers.