For artist view it's still there (artists with only one album)
I believe that's why the feature was added, to show the cover of a single album in artist view.
tbh I don't know what's so good about such a small stretched album icon, why do you want to see it like that? Most people have artwork element on a side bar anyways, which looks thousand times better? If you don't have "show album art" enabled, I don't expect any album art at all in the expanded panel.
Maybe make it an option for those who really want to see the album art in such a small size?
OR better yet, for artists with only 1 album, just show the album normally in expanded panel and not directly the tracks, like any other artist with multiple albums. I don't see anything wrong with 1 extra mouse click if it means just seeing the album art in normal size.