The crucial question is how we want to value the creation of new sentience (aka population ethics). It has been proven impossible to come up with intuitive solutions to it, i.e. solutions that fit some seemingly very conservative adequacy conditions.
The view you outline as an alternative to total hedonistic utilitarianism is often left underdetermined, which hides some underlying difficulties.
In Practical Ethics, Peter Singer advocated a position he called "prior-existence preference utilitarianism". He considered it wrong to kill existing people, but not wrong to not create new people as long as their lives would be worth living. This position is awkward because it leaves you no way of saying that a very happy life (one where almost all preferences are going to be fulfilled) is better than a merely decent life that is worth living. If it were better, and if the latter is equal to non-creation, then denying that the creation of the former life is preferable over non-existence would lead to intransitivity.
If I prefer, but only to a very tiny degree, having a child with a decent life over having one with an awesome life, would it be better if I had the child with the decent life?
In addition, nearly everyone would consider it bad to create lives that are miserable. But if the good parts of a decent life can make up for the bad parts in it, why doesn't a life consisting solely of good parts constitute something that is important to create? (This point applies most forcefully for those who adhere to a reductionist/dissolved view on personal identity.)
One way out of the dilemma is what Singer called the "moral ledger model of preferences". He proposed an analogy between preferences and debts. It is good if existing debts are paid, but there is nothing good about creating new debts just so they can be paid later. In fact, debts are potentially bad because they may remain unfulfilled, so all things being equal, we should try to avoid making debts. The creation of new sentience (in form of "preference-bundles" or newly created utility functions) would, according to this view, be at most neutral (if all the preferences will be perfectly fulfilled), and otherwise negative to the extent that preferences get frustrated.
Singer himself rejected this view because it would imply voluntary human extinction being a good outcome. However, something about the "prior-existence" alternative he offered seems obviously flawed, which is arguably a much bigger problem than something being counterintuitive.
In my view population ethics failed at the start by making a false assumption, namely "Personal identity does not matter, all that matters is the total amount of whatever makes life worth living (ie utility)." I believe this assumption is wrong.
Derek Parfit first made this assumption when discussing the Nonidentity Problem. He believed it was the most plausible solution, but was disturbed by its other implications, like the Repugnant Conclusion. His work is what spawned most of the further debate on population ethics and its disturbing conclusi...
When someone complains that utilitarianism1 leads to the dust speck paradox or the trolley-car problem, I tell them that's a feature, not a bug. I'm not ready to say that respecting the utility monster is also a feature of utilitarianism, but it is what most people everywhere have always done. A model that doesn't allow for utility monsters can't model human behavior, and certainly shouldn't provoke indignant responses from philosophers who keep right on respecting their own utility monsters.
The utility monster is a creature that is somehow more capable of experiencing pleasure (or positive utility) than all others combined. Most people consider sacrificing everyone else's small utilities for the benefits of this monster to be repugnant.
Let's suppose the utility monster is a utility monster because it has a more highly-developed brain capable of making finer discriminations, higher-level abstractions, and more associations than all the lesser minds around it. Does that make it less repugnant? (If so, I lose you here. I invite you to post a comment explaining why utility-monster-by-smartness is an exception.) Suppose we have one utility monster and one million others. Everything we do, we do for the one utility monster. Repugnant?
Multiply by nine billion. We now have nine billion utility monsters and 9x1015 others. Still repugnant?
Yet these same enlightened, democratic societies whose philosophers decry the utility monster give approximately zero weight to the well-being of non-humans. We might try not to drive a species extinct, but when contemplating a new hydroelectric dam, nobody adds up the disutility to all the squirrels in the valley to be flooded.
If you believe the utility monster is a problem with utilitarianism, how do you take into account the well-being of squirrels? How about ants? Worms? Bacteria? You've gone to 1015 others just with ants.2 Maybe 1020 with nematodes.
"But humans are different!" our anti-utilitarian complains. "They're so much more intelligent and emotionally complex than nematodes that it would be repugnant to wipe out all humans to save any number of nematodes."
Well, that's what a real utility monster looks like.
The same people who believe this then turn around and say there's a problem with utilitarianism because (when unpacked into a plausible real-life example) it might kill all the nematodes to save one human. Given their beliefs, they should complain about the opposite "problem": For a sufficient number of nematodes, an instantiation of utilitarianism might say not to kill all the nematodes to save one human.
1. I use the term in a very general way, meaning any action selection system that uses a utility function—which in practice means any rational, deterministic action selection system in which action preferences are well-ordered.
2. This recent attempt to estimate the number of different living beings of different kinds gives some numbers. The web has many pages claiming there are 1015 ants, but I haven't found a citation of any original source.