I think initially, I expected a much more simple explanation of the storybook. It would have made sense if Blue had created the book as a way of ensuring the Curse would be broken. Maybe it was initially a self-recording book (like the one in the Oz book), but Blue altered it so that the stories of Snow's best friends and allies would be included. Maybe she also got insider information about what Regina did from a spy within the castle. It was inferred that Blue had to make "preparations" for the Curse I think? But they never referred to that again because let's hire a great actress and let her do nothing!
It would have been hilarious if at the end of 4B, Blue had revealed to Regina and Rumple, "I wrote the book, you dumbasses. There's no such thing as The Author".
The concept of having someone who is called "The Author" was too convoluted and raised too many problems with the logistics of how he/she can be everywhere at once, and whose stories got told and whose didn't. The whole idea of "The Author" having powers was even worse - it messes with free will, so makes the plot less interesting to me, if someone can just force others to do whatever with their magic pen.
I would have liked an exploration of other people from "our" world who had accidentally stumbled upon the Enchanted Forest and other "realms", and had come back telling the stories that THEY saw, perhaps with embellishments or biases. They didn't have to be "The Author". That was how they could have included people like Disney, or the Grimm brothers, Perrault, and even Shakespeare or Jules Verne, etc. if they wanted to be creative with it. They could have had authors like Lewis Carroll or Frank Baum encounter people who did venture into other worlds, so got their information second-hand.
Henry didn't need a power. If he really had to have one, maybe he of the Truest Believer could believe something into existence if he thought/felt really hard. It wouldn't be any dumber than Henry waking up in the morning and somehow writing and illustrating an entire tale that happened somewhere else.