There is not so much information yet on what the dialog opening from the title bar would contain. However, I will try to explain why I think that the users feel that the old Vector's current compact language list dialog is bad vs. the full list of languages.
Compact language list target is that the user selects one language as efficiently as possible. For that purpose, the languages are visible multiple times if they are spoken on different continents. The dialog is also small so the user needs to scroll the box if the user doesn't filter the languages. It is effectively impossible to actually see what languages are. Dialog also doesn't show if the user has been on the page before because the visited link color is the same as the unvisited link.
However, the very common use case for users (i suppose for both, editors and readers) is that they want to open the different language versions of the articles to new tabs. For this they need a.) a clean list of pages and b.) information if they have already opened the page or not.
This is the functionality that the compact language list is breaking. The ability to filter languages is however pretty well-liked, and in this sense the mobile wikipedias filtered list of all languages is better than compact language list (or old interwiki link list)