I OHKO'ed all of Jasmine's Pokemon. And Misty was my nightmare... She kept killing my team over and over. So, i think you can't counter Water easily while Steel has weaknesses. Also, i think Wallace looks like a Champion more than Steven. I think Steven should be last Elite 4 or last Gym Leader.
Wallace
Water are NOT easy to take out if used right. They only have two weaknesses, One of which is destroyed by ice beam which is learned by almost every single water pokemon. The other weakness can be blocked 100% by pokemon like swampert and others with a ground sub type and lanturn's volt absorb or can be made less a threat by pokemon like kingdra and ludicollo. Then milotic is the perfect ballance of offence and defense making it a brilliant end boss.
However he could still use a few changes.
1. His gyarados has too many special attack moves making its dragon dance pointless. Try some other moves like EQ, Waterfall, aqua tail, bite, ice fang or even giga impact.
2. Get rid of whiscash for a swampert. Why shouldn't the champion be allowd to have a fully evolved starter pokemon? His team needs more physical coverage (also applied to #1).
3. Replace wailord with a kingdra. I'm sure drake won't mind if you take his... It would be a better setup pokemon than wailord because it only has one weakness, great rounded stats and can still setup your rain dance (with its swiftswim to ensure a second chance to hit) then use a new move scald to burn your enemies. After that blizzard and some sort of powerful dragon move will do.
4. Get rid of tentacruel for a lanturn. Volt absorb protects against electric attacks and heals it. A perfect switch in for a water team. Maybe an extra rain dance with some thunder action. Then standard ice beam/ hydro pump your way to victory if thunder won,t work.
Basicaly I think his team (in the hopefully to be RSE remakes) should be:
Kingdra
swampert
lanturn
ludicollo
gyarados
milotic.
They're all still native to the hoenn region so why would they not keep him a champion in a future version with them all in the 70/80 levels with even better pokemon?