So they killed Peter Parker so they could replace Spiderman with a ...

Seems like an odd move for the comics too, but not a big issue I guess.

Expands the SM universe though which can't be a bad thing.

Well, it was kind of the straw that broke the camel's back for the Ultimate Universe when they did that. They killed off a ton of popular characters already in a terrible crossover event called Ultimatum a few years before that. Then they killed off the Peter Parker/Spider-Man of that Universe just to replace him with a minority. Just for the TC whenever you have the time, watch this review of Ultimatum.
https://www.youtube.com/watch?v=UGY9drl6IkI
https://www.youtube.com/watch?v=KWnUbMFWTM8
https://www.youtube.com/watch?v=xWRaqW9Zxls

Also they have used aspects of the Ultimate Universe even in the first Raimi Spider-Man movie. Like Harry and Mary Jane going to highschool with him and him getting bitten by the Spider while on a field trip in school. In the original Spider-Man comic he was bitten by the spider at an event he went to by himself after school. Also in the original comics, he didn't meet Harry, Mary Jane, or Gwen Stacy til he was in college.

Yeah as opposed to the majority of animated movies *not* being kid friendly......