Wouldn't warlords take over? No. To do so they need willing participants or to use force against others to make them participate.

Non compliance works wonders. Oh and the new warlords followers wouldn't be benefitting from some insane notion of legitimacy. As without the state the lie of legitimacy is broken and either through persuasion or coercion can you get someone to submit to your will.

Will everything be perfect nope, that's not even what's advocated. It would be moral, ethical and result in less death and destruction from people who blindly believe obedience is a virtue.