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Since I'm that kind of nerd, I ran the numbers in Excel. tl;dr is that Chain Blast is fine.
It's absolutely worth using against three or more targets, and situationally useful against two. (Against two targets, Chain Blast does provide an overall increase in expected damage if you have at least a 60% chance to hit. In most cases, however, this increase is small enough that focusing fire on a single target will usually still be a better idea.) I expect this is exactly what the devs intended.
For more detail: when you use Chain Blast, your chance to get an nth attack (not necessarily hit with it) is equal to (your chance to hit)^(n - 1). So, 100% for the first attack, since you always at least get to attack once; (your chance to hit) for a second attack, since you get it if and only if your first attack hits; (your chance to hit) squared for a third attack, and so on. Each attack you get is actually worth a number of expected hits equal to its chance to hit plus its chance to crit. So, I think this analysis is basically right:
Now let's calculate the chances of Chain Blast hitting considering that each sequential attack had to hit the previous one to be attempted:1st hit chance on target: 65% (15% to crit on this individual roll)
2nd hit chance on target: 42% (15% to crit on this individual roll)
3rd hit chance on target: 27% (15% to crit on this individual roll)
4th hit chance on target: 18% (15% to crit on this individual roll)
5th hit chance on target: 12% (15% to crit on this individual roll)
Thus, taking crits into account, Chain Blast with a 65% chance to hit (8 or better on the d20) gets approximately 1.32 expected hits worth of damage against two targets, 1.66 against three, 1.88 against four, and 2.02 against five. By contrast, attacking twice normally gets 1.25 expected hits (65% hit/15% crit for the first, 40% hit/5% crit for the second). Furthermore:
And even if your Clain Blast fails on the 1st attack and you lost 2 actions, your 3rd action is still at -5 MAP, so you can try it the same way you can try a 2nd attack after a normal Impulse or...
This turns out to make a significant difference. If you're making a third attack, an 8 to hit means you have a 35% chance to make that third attack at –5 rather than –10. This turns out to be worth another 0.09 expected hits (all told, you get 1.61 expected hits compared to 1.45 for attacking normally). So, in both cases, Chain Blast is indeed better, but not by a huge amount.