No it's worst nightmare and disaster that has happened in the Thedas.
Why in the world disband Circles? Why dismish templars? How in the world Inquisition could watch over mages better than templars? Why that would make mages suddenly mages free of threat of demon possession and using their magic wrongly?
For one thing, if you side with the mages, the Templar Order becomes corrupted and tries to help Corypheus conquer Thedas. That means that the Templars are pretty much hated. You can see this in comments even if you side with the Templars of some people who think the templars went too far and needed to be leashed.
As for how the Inquisition could rule better, for starters, the Inquisition isn't run by the Chantry so the rhetoric that mages are corrupt and evil simply for existing likely won't continue unless your inquisitor is meredith 2.0. Secondly, as stated by Cullen, the mages and templars start getting along as time goes on. The Inquisition would offer both safety and camraderie so the mages would likely enjoy staying seeing as how the Inquisition is now a power to be reckoned with. Also, there are options such as having hidden watchers or mage-fighting training. Don't forget how there is a school of magic dedicated to fighting other mages so mages are perfectly capable of fighting other mages. Don't forget how about the Seekers under Leliana or Cass who could stop any blood mages or abominations that occur. Also, there are practically no abominations among the free mages so the fear is seemingly just paranoia. As for blood magic, if the Inquisition isn't something to be feared, mages likely won't be forced to use forbidden magic to escape which considering the mages choose to remain, likely means peace.