The Choice Specs set can have both Earth Power and Flash Cannon, I said U-turn "Could be put on specs", but I never said it is always there. Earth Power and Flash Cannon are definitely better than U-turn. So your argument about F-cannon and E-power applies to specs too. While both Specs and LO Flash Cannon do 2HKO Clefable, LO E-power definitely does no 2HKO non-av azumarill, it only has like 35% chance and if it's 0 HP it's 80%. Specs 2HKO. It is true though that Chansey and fairies will wall Specs Hydreigon, But that is true to LO Hydra too. Iron Tail doesn't 2HKO Clefable. Superpower doesn't 2HKO Chansey either unless you invest a considerable amount of EVs in Atk, and if you do, you will lose to rolls more often against Azumarill and eventually Clefable. Superpower doesn't 2HKO Ferrothorn either and you need rolls to 2HKO Heatran. In fact, Specs Dark Pulse does a little bit more than LO 0 Atk (Mild/Rash) Superpower does to Ferrothorn.I don't know where you got the information that choice specs is the best set, and tbh it's a terrible item on hydreigon. Being choice locked into one of its stab moves is really bad in this meta, and the mixed LO set is devastating to switch into for balance teams, as flash cannon cleanly 2hkos clefable and earth power 2hkos non-av azumarill, while it can run superpower or fire blast for steel types. And don't act like something not named Chansey / blissey or a fairy is switching into one of its stabs.
Heck, specs Hydreigon is ass even in UU, where the dragon basically rules the tier.
Anyways, hydreigon is pretty solid in this meta and I agree with others that it deserves C+ at the very least, and maybe B-
I used mixed LO a bunch of times and it really didn't bring as much as results as you were saying (I did use Iron Tail > Flash Cannon though). Not every team has Chansey or a Fairy, and if there is a Fairy type Hydreigon will usually rely on teammates for that, this is also true for the LO set. The only thing Mixed LO has over Specs is not being choice-locked and being a much less of a dead weight against Chansey. It might be true that I underselled Mix LO, but Specs is definitely not terrible. And even with your reasons I still think Hydreigon for B- is a bit of a stretch. I think C+ is its place.