Is the purpose of the Electoral College to ensure that the smaller states still have a general say in the matter, and prevent them from being marginalised and overshadowed by the larger states?
That's one of them. In the 1700s going into the early 1900s, the issues were often between large and small states. These states would bicker and scheme just like nations do. Today, most of us see ourselves as Americans first, and Californians or Texans second. "Protection" of the states from each other is really necessary any more. The primary reason, was the fact that when the US was founded, the majority of people were uneducated. Although most states allowed only white land owners to vote at first, most of them did not know the first thing about politics, and the only means of communication was the newspaper. Therefore, the solution was to have the voters elect people to vote educatedly for them. Winner-take-all, or "first past the post" system only came into play when a two-party system evolved.
There are in fact some advantages to a winner-take-all system. One of them is when you hear that Obama won the election with 51% of the popular vote it appears that we are divided. With winner-take-all, a winner seems much clearer, and it appears that he won a huge amount of Americans' support. A more extreme example would be Ronald Reagan in 1982. He won an amazing 527 out of 538 electoral college votes, but only 60% of the popular vote. This is still a huge and clear majority, but 97% sounds a lot better than 60%.
However, this is only an appearance, and there have been in fact a few presidents who have won the presidential election without the popular vote, as you mentioned. The first was John Quincy Adams in 1824, and the latest was George Bush in 2000. The vast majority of the time the electoral vote does reflect the popular vote, thankfully.
Here in the UK, we're having a similar debate between the old 'first past the post system' and the 'alternative vote' system. With the current system, it's possible to become a Member of Parliament with less than half of the voters in your district voting for you. In other words, the majority of peoples opinions are chucked to the curb.
Another problem with the electoral college system is that minority-party voters in a state will almost always have their vote thrown away. Let's take California for an example (because I live there). The majority of Californian's are Democrats. Basically, it doesn't matter how many Republicans are in California, unless they have are majority, all 55 of California's electoral college votes will go to the Democrat presidential candidate. Basically, all Republicans in California might as well not even vote, as it is wasted. Under the Maine-Nebraska system, this would still happen, but in a scale of small districts rather than states. I'll use the 22nd District of California as an example, again because it is where I live. The 22nd District is very Republican; the most Republican district in the entire state. Under Maine-Nebraska, Democrats living in the 22nd District will have
their votes wasted. Still, it is a step in the right direction.
With AV, a voter lists their candidates in order of preference (1 to 4). In each round, the person with the least amount of votes is eliminated from the running (I think). So the final result is more representive of the public's opinion.
I was under the impression that the UK had a "strong party" system, where voters vote for a party rather than a candidate and the party appoints the candidates themselves. Has it been changed? Or am I just wrong?