I think 2e wanted to be more "realistic" - i.e. punching/kicking only caused subdual damage, and not much at that, although it could sometimes KO the opponent. 1e Oriental Adventures had martial arts much more deadly, with 1st-level PCs doing as much as 1d8 damage per hand strike (with often more than one strike/round), even if they were Wu-Jen
I personally have seen very high-level real-life martial arts, and would thus go with the 1e side, but perhaps make it harder to reach such levels of deadliness (i.e. perhaps 1st-level Wu-Jen shouldn't be able to get that with but a single proficiency slot).
I do think that there should have been some reconciliation with the monk, "kensai" (should be kensei), and non-class martial arts, though.