Yeah, getting Lydia is midgame, and has been for some time. I consider the act of farming the gear and building the teams to get her as the way to open the gates to the end game content. Just the process of building gear sets good enough, and having enough of a stable of champs, that is what lets you finish all the other content.
The past couple weeks I've seen a lot of feedback about how difficult the onboarding is these days, but I still see the process fairly linear, even if you know players will jump around a bit here and there. I think it still goes Easy Dungeons like Dragon, IG, Spider, FK -> NM/UNM CB -> FW & Lydia -> All Hard DTs -> Tier 2 Dungeons, Twins, Sand Devil and Shogun -> Tag Team Gold -> Hydra -> Hard Cursed City
I don't have an answer on if that message of progression needs to be clearer in a challenge and mission update, or in some other method, but there we are.