The slot should be deeper and the notch larger, or there should be multiple slots/notches, or something.
Perhaps but that would cause other issues, in my opinion. On more than one occasion, I have seen that groove in the steering stem actually split, thanks, primarily, to the stem being inserted too little. Once that happens, repair becomes wayyyy more difficult.
Knowing the turning tab washer to be a problem with many bikes, I lubricate the faces of the tab washer and top nut. This helps to prevent the washer from trying to follow the top nut during installation and removal. It does not always work, but is better than saying "oops". My opinion, of course.