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Diminishing returns are already broken as they are. Just a band-aid fix.

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When done properly it isn't. Diminishing returns is MEANT to counteract the situation where you gain an increased percentage of benefit from the stat getting pushed higher.
Perfect example of this is block. The difference between 80% block and 85% block is 25% of damage overall negated by the extra 5%, but the difference between 20% block and 25% block is 6.25% of overall damage negated.

Same amount of block was added, 5%, but as things like that get higher their effectiveness scales upwards.
Flat def/res is also similar.

Incoming hit: 500
Resist: 100 vs 150 (50 difference)
Result: 400 damage taken vs 350 damage taken. Difference of 12.5%.

Incoming hit: 500
Resist: 300 vs 350 (50 difference)
Result: 200 damage taken vs 150 damage taken. Difference of 25%.

Same amount of resist was added, but as resist gets higher it also scales more effectively. Every time you put a point into it, it's more effective than the point before it. You have to diminish the effect as it gets higher to bring it back down to an equal amount of benefit per point.
When nothing diminishes, it becomes useless to bring low stats to a medium range, as you will get more benefit from bringing high stats to an even higher range. This is how stat abuse builds are born.
This is why diminishing returns exist. This is also why flat def/res numbers are really bad for the game.

This is also why rage was introduced: a mechanic to reduce the overall def/res gain of those points by piercing it more frequently the higher it gets, rather than diminishing the actual returns.