And its mandatory-ness causes headaches for, so far as I can tell, no good reason.
I think largely setting purposes: everything seems to have a weakness - so it doesn't really make sense to get out of it just by having enough Refresh not to need the Catch rebate. Even Mab flinches from iron.
The only real problem, IMO, is caused by
non-supernatural toughness such as really big creatures - the two extra stress boxes from Hulking Size aren't nearly enough to represent how much tougher something like Sue or Tiny the Gruff should be, just from being multi-ton critter, even before any supernatural defenses they might have.
Personally I don't see it as possible to balance PI against toughness at any refresh because PI is unquantifiable so the numbers don't add up.
I agree, the costing is kind of arbitrary.
Mind you actually the next time step down after mythic recovery would be healing all wounds (except extreme) instantly so PI does make sense as an upgrade to recovery.
Viewing it as super Recovery with a healing time of "absolutely instant", before the being can even lose blood or die from what would otherwise be a fatal wound, makes sense, yeah.
I'd actually personally like it if some things with PI instead had supra-Mythic Toughness or supra-Mythic Recovery (with a Stacked Catch as normal PI). Would a grendelkin be able to ignore, or would Madrigal's ward cloths be able to block, a fire spell cast by the original Merlin or by Kemmler? IMO, there should be some limit, since the grendelkin's power is in "fluff" described as an ability to counter magic. (I'm willing to accept Nicodemus' noose protection and Lord Raith's magic immunity as genuinely absolute - at least as long as their power source - probably Hell/Lucifer and HWWB or an Old One, respectively - exists, and short of intervention on the level of a no-holds-barred Archangel, a Faerie Mother, or higher. Loup-Garou ... depends. If they're
really a Heaven-powered curse, it could really be absolute; otherwise, I'd vote "just really insanely tough", they probably wouldn't survive ground zero of a nuke or a Tunguska.)
Basically, I think immunity should work like everything else in the setting - power has to come from somewhere. If you're tough because of your personal powers/magic/supernatural nature, it should be limited by that power; effectively limitless toughness should require drawing on some effectively-limitless power source.