Why did wulin invest so much into developing Kiu Fung when it was going to ruin him?

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I don't disagree with this thinking, but obviously, this being a wuxia novel and the guy being a earth-shaking wuxia hero, it wouldn't be very fun if they decided to restrict him to literature, arts, and farming.

Sure they could. Just that in chapter 3 he falls down Wuliang Cliff and finds the 24 Variation God and Ghost Exchange Scroll written in a strange mix of code which only someone with extreme knowledge of literature, Sanskrit, chess, astrology AND farming could decipher. In fact, due to his polymathic knowledge, he could master the theoretical 25th variation which even the _original_ creator never reached as his knowledge of goat husbandry was slightly lacking.