The real problem with Ofsted is that it has too much power. Over the last few decades control over the educational system (national curriculum, inspection etc.) has become increasingly centralized and dictatorial which means that inspection processes for thousands of schools in very different contexts are standardized and the assessments very crude and therefore inhuman.
From my experience of numerous inspections the inspectors have no interest in context (of schools, classes, lessons etc.), they just apply the formula they have invented. Then you get into a situation where you have to apply a planned Ofsted tick box lesson when they come into the classroom otherwise they will not know how what you are doing fits into your learning strategy (your pupils could be doing some independent research). The inspectors judge lessons purely on what they see and have no interest in the context of the lesson. They will judge your lesson inadequate in 20 minutes and that is that.
They have also become increasingly obsessed with safeguarding. My last school was always judged inadequate not because of the quality of the education (this was excellent) but because the data to support safeguarding was was not rigorous enough. I never for one moment felt that the kids were at risk. Thankfully, the parents took little notice of the Ofsted grade but I imagine that is an exception.
All of this creates a culture of fear. Ofsted is tremendously damaging, existing as remote surveillance even when the inspectors are not there as schools are always paranoid about being Ofsted ready. They have seeped into the culture of education.
Really this is about the government not trusting teachers and disempowering. To create a healthier, more human system we need to devolve power to schools and local authorities so that context is taken into account and inspections become supportive and a positive learning experience for all. Schools and teachers should be facilitated to develop their own monitoring systems. This is what a school inspection system should be doing.