I agree that this is a viable solution, but then again it makes Bitcoin less distributed. The nice thing about running a full Bitcoin node is that you are one of the voices in the network contributing your say to what chain is legit and what chain is not. If everyone is running wallets across only a few 'trusted' servers we lose this awesome feature of Bitcoin.

As a practical matter, solving the blockchain length is an important one IMHO. I don't yet have any ideas to contribute to solving this.