Yes, but: the winning party having less than 50% of the votes still feels incredibly undemocratic, as you get a situation where a majority of the voters picked a different choice.

Proportional systems give an outcome where a majority of voters voted for at least one of the parties in the winning coalition. Coalitions become explicit rather than internal to parties. The internationalist/isolationist split in the Conservative party that they were desperately trying to put off would have happened much earlier.

The referendum failed because only the LDs really supported it. I note that all sorts of devolved assemblies, councils, and (former) Euro elections used different systems.

Why does it feel undemocratic? I have always felt that party politics are undemocratic since my voting system (Sweden) translate to voting persons into seats in parliament. Political parties and coalitions are just systems added on top of that system that get translated into people in seats. Votes in parliament are counted per person, not per party or block, and people can vote against party line.

I would support a move to a more proportional system, but I think it's an exaggeration to describe the present system as 'incredibly undemocratic' (especially given that a clear majority of the voting population chose to keep this system in a democratic referendum not very long ago). There's plenty to criticise about the UK at present, but HN sometimes goes off the rails on this topic. I suspect that a post describing the USA as 'incredibly undemocratic' would get shorter shrift – even though the electoral college is arguably an order of magnitude more bonkers than the UK system.

Edit: I'd also add that the UK is astonishingly democratic in some respects. It is remarkable that Brexit was implemented merely because a majority voted for it. There are few countries where such important decisions of national policy would be put to a popular referendum in this way and then implemented faithfully. (I was very firmly opposed to Brexit, FWIW.)