Having the (Fedoras) install process work different than basically everything else is a bad choice in itself. And changing everything else would be utter idiocy[...]
Seriously, why would you require conformity between all existing installers in such utter detail? Surely, we must allow some room for diversity.
[...] displaying passwords without significant compelling reasons is simply atrociously bad design.
The reason would be that when you are setting a password, it is much more important to get it right. Furthermore, this is normally a rare activity, so the risks of displaying the password are proportionally reduced. I'm not saying this reason necessarily outweighs the risk of shoulder surfing, but I don't think the argument is as black-and-white as you make it.