I like the the idea of S-burn but agree that it trivialises and invalidates too much (E-burn, Burn levels, chasing/running away from other fleets, sense of scale and wonder). It needs to be a lot more situational: I'd suggest giving it a very long charge-up, make it build up speed even slower, make it only usable with planned trips (i.e. changing your destination immediately shuts it off, can't be targeted on fleets), and make it practically blind you while lighting you up for half the system to see. It should be something you'd use only if you're fairly certain you won't get waylaid on the way.
Even then I fear it diminishes the size of the Sector too much, especially if AIs can't use it. Maybe add an extra fuel penalty that also applies in-system to further discourage it's use. Yeah I get this is pretty fun-policey but hey.