I mean if you want to give it some more combat capability wouldn't it be better for it to straight up have a 222 upgrade instead?
I think it would be a shame to go through the trouble of having a 221 with a 223 upgrade if the 221 is not going to be useful in combat. I think it was only used for fighting once in the entire tourney, and only very briefly. It simply comes too late for what it can do. Giving OKW an early light vehicle would open up strategies to counter snipers or HMGs, and would probably see the 221 used much more. 222 isn't needed because of the Luchs. It would give some initiative to OKW and force enemies to invest in AT/snares just like the Scout Car and UC do, and break up the boring Volks meta a bit.
There should be vet1 Riflemen and Royal Engineers (now with snares) around the time an SWS-tied 221 would hit the field and Soviets have options for AT nades and PTRS Penals in any strat, so there should be enough softcounters to prevent a rampage.
I proposed it replacing the Medkits (which overlaps a bit with SPio and MedHQ) so the overall ability count remains unchanged.
Would be a possibility, yes. Although the healing could also be changed into dropping only 1 crate or acting like Ostheer medkits to heal squads on the front line to set it apart from the 'base healing' of Sturmpioneers and MedHQ.