MITM is always an issue, but the same could be said of going to download the iso in the first place without a md5. I still think I agree with you in terms of the local credentials however I wonder if this is (in effect) you giving the deck the password to authenticate (since the server presumably reaches out to announce itself, perhaps with its public key) the returning response and credential/token/whatever means is used wold then be established. Given there is a commitment to a local ui by the company here, that might address things for an enhanced threat profile. I'm thinking the modal might be more similar to Unifi controller experience and the deck excels at muti deployment or remote management ease of use.
Yes, manual verification would be great however I think once you are asking users to start scanning to verify fingerprints your going to be adding a significant amount of friction. I would look into webauth and how at then end of the day server validation is handed by TSL (thought I would acknowledge that its not the secret that gets transmitted).