Actually, it's less flexible for the player.
Care to explain? Oh, you can't because you are wrong.
Let's take the speech skill for example. In Skyrim you can't play a character, which solves his problems by using speech, because (besides the fact, that there are much too less options in conversation to actually make use of it) there is no way to train that skill.
Every character, no matter if mage, warrior, thief, whatever will level that skill about as fast as the other "classes". It slowly goes up with time and you have near to no influence on it. Using speech-checks when you can is something everybody does anyways as is selling goods.
The whole system is weak from a gameplay point of view, because it adds almost nothing.
Where is the fun in auto-leveling? Where is the fun in having to grind a skill to a level, where it's finally useful?
Let's say I played a warrior the whole time, but later want to add bows. In a game like Fallout you could just start to spend skill points on it and then use it, when it's strong enough to be fun. In Skyrim you have to painfully level your bow-skill by using it even on the weak levels.
Also you can't just "do what you want and be who you are" (one of Todd's marketing-phrases) with the TES leveling. You are forced to do stupid/annoying stuff to grind skills, if you want to be strong. You can't just play how you want and then spend your points.
I like Skill-based leveling more than XP-based leveling because it allows you to increase the "utility" skills you use a lot without making you feel like those points would be better spent in combat skills, especially in a game with skill thresholds.
You can easily do that in an XP based leveling system for example by providing different skill points for a) combat influencing skills

other skills.