East Timor was invaded, occupied, then separate, so not sure why that counts as decentralization. Agreed on the importance of the tsunami on sealing negotiations, but that was only the final trigger; and at any rate, Aceh, for all its problems and autonomy is still part of the country. And even though West Papua is much closer to full blow fighting in recent years, again, still part of the country (although admittedly shakier than Aceh.Well decentralisation didn't prevent East Timor from separating, and it was the Tsunami more than decentralisation that stopped the Aceh independence movement. It's done absolutely nothing for West Papua.
In terms of effects it has had, the marked increase in corruption (and it's not as if it was good in the '80s) exacerbates what I'd say is the leading political and economic issue. Followed by the apparent backsliding on secularism and the increase in deforestation which also resulted from decentralisation.
Obviously, corruption is a massive problem, but setting aside the not-democracy years, Indonesia was always relatively decentralized (there is just no way to centralize power in an island nation of that size, let alone one with as many stakeholders as Indonesia) . And I share your concern about the backsliding, but what country would you use as a benchmark for Indonesia? Because I can't think of too many fair comparisons that it isn't ahead of (with the Philippines and India being obvious comparisons). Bottom line, I agree with you on the problems Indonesia faces, but I think you and a lot of people underestimate how difficult democratic transitions are. They've been several orders more successful than the U.S.'s transition to democracy, even accounting for being able to learn from other countries' experiences.