We are pretty clearly missing something because I don't think Lienna has appeared strong enough to warrant another nation holding off on invading. Lienna's own recollection is that she never fought on the frontline so either she's lying to us the reader for no particular reason or she did something casually that instilled fear in the other nations.
Was Claire that same girl that kept Lienna from living a normal life? I mean I guess I like that she got murked and the whole country is gonna be destroyed. It just feels kind of anticlimactic. Presumable the knights that got killed were the strongest below Lienna but like if they're not that strong how could Lienna be strong or be trained to be that strong. Lienna has been swamped in paper work since becoming the commander and doesn't have time to train. How could she possibly have gotten stronger or stayed as strong as before under these circumstances?
She only said she never fought on the frontline after she became the commander. Her armor is probably new, not the same as when she was a lower rank. We do not really know how good she is...
...Except we do? Just taking the previous chapter, she took on a Kaiju like monster. I'm not sure you see her as anything but a monster herself. Armor or no, she gets clocked by it and just gets back up almost like nothing happened. She has both the skills and sheer focus to take the monster head on, and with one blow she severed it's arm.
I personally think that they do indeed select the Knight Commanders for their ability. Just as you note that the vice-commanders got jobbed, at the same time there must be a reason she's the commander and they aren't. We thought that reason was because nobody wanted her job, since it's just administrative. But that's just because we didn't have any evidence for another reason. Now we do. They are likely selected for ability, kept in the rear to safeguard them as weapons of deterrence, and given admin jobs because in the status quo they aren't needed for their primary purpose. Since they can't be sent out, at least routinely, it's either have them do admin work or conduct training. We do know she actually even does the latter.
I don't think its right to keep harping on this idea of her being a bonsai plant just because that's the first impression we got from the series, that came from a bunch of low ranker knights who don't have a good view of the geopoltics and military concerns.