What is the feasibility of using Entity Reference instead of Taxonomy?
Is there really a performance difference?


For sure! Totally different and independent pieces of code was used for it, so there must be.


  Can it be quantified?


You can measure it, but because taxonomy is pretty well defined, and references are open to configuration, your mileage will vary. Overall, taxonomy is older, and optimized for speed - a lot of terms on one node is common. Also, it's easier to optimize something that works only one way.


  I need hierarchy support. Is there a good option? Searching around, the land of Entity Reference hierarchy options exists but seems like a wild west at this point.


Exactly! Everyone consider different things good, so implementations vary. I don't know what your "good" means, so I can't tell if it happened to be similar to one of already implemented "good".


  Are there better solutions if my only complaint is site admin UX?


Again - it depends on what exactly you consider better. There are things like Taxonomy Manager, but it addresses things it's creator considered that need to be addressed, in a way that's better - for him.


  Taxonomy is the best-practice, as it is in core, for the general use case. 


Not really... But that was a claim, not a question anyway.


  I'm wondering what else I haven't considered in going off the beaten path here.


And this is simply too broad for Q&amp;A