I strongly disagree that it's a significant representation of the film. It has songs, and that's about it. The character representation is superficial.
The show doesn't need the Lion King songs or characters; they could be replaced with generic characters and other songs and it would have very little effect on the show. Which is probably a good thing from a show design standpoint, but a bad thing for representing the IP in any meaningful way.
Admittedly, I don't think Festival of the Lion King is entertaining or interesting (I saw it once and have no desire to see it again), so I'm sure that's part of my issue, but the Lion King is one of my favorite Disney films. I'd like to see it represented in a way that actually showcases the characters instead of being almost entirely about the soundtrack.
This I totally disagree with. It features the characters as part of the narration of the show, and with the floats/animatronics.
Also there is no way you could replace the show with generic characters and other songs, and not have a massive effect on the draw of the show/experience. The kids are there to experience what they know. While I wouldn't go as far as to call it a glorified sing a long (and that is not an insult, as I like the actual Frozen Sing along) a large part of the appeal, especially for younger kids is being able to know and sing along with the music. You are not going to get that with just random generic characters and songs.
The other issue I have on a macro level with talk about building new parts of the park with "established" IP, is as much as I, and people of a certain age love it its getting old. Lion King is almost 30year old IP. Sure there have been some attempts to "re-introduce" the brand through some direct to video sequels, the live action release, and from what my kids said, a pretty good Lion Guard animated series, it is still 30 years old. For adults in their 20-30s, the movie isn't even one from their childhood, its from their parents, so for the next generation of kids, its going to be even another generation removed.
That's why from a generational standpoint, new builds like Frozen Land, Moanna, CoCo, ect, make more sense. These are movies that adults now took their kids to, the next generation grew up with, and then in the future, will be showing their kids. While my kids love the Peter Pan ride and loved Winnie the Pooh when they were younger, they have no real emotional attachment to the story/rides/IP. Its one of the reasons that while there have been hits and misses, I understand and appreciate the attempt to reintroduce older stories in the live action model. It helps try and keep the fundamental stories fresh in the next generation.