Yeah mercy is absurdly strong at the minute. Personally I feel that her rez mechanic just needs to go completely for the sake of balance, but im not sure if theyll ever do that as its always been her signature ability.
I think her ultimate is fine without the double rez -- very strong even without it, is like an orissa ulti or you can put out massive amounts of group healing, and i think the balance between offense/defense suits her quite well and is in line with other 'strong ultis'.
So what to put on her E? Maybe a ressurect but only if the person dies within a certain time period, sort of like kharazim's ability in hots?
Or since shes supposed to be a battle healer, maybe E can increase her own damage to let her handle flankers a bit better or increase self healing a bit? Maybe both? But knowing blizzard theyd make her unkillable, so probably just increase damage or something.