I'm a die hard Pirates fan, I know all about Ollie...
Location and command wasn't his only problem in '05 and '06. Although he did walk a bunch of hitters, his velocity was way down. He was hitting 92ish for a majority of those years. In '05 the speculation was that it was caused by the Pirates forcing him to skip winter ball for the first time in his career. They went into '06 hoping that was his problem and he'd be fine because he played winter ball again. Turns out it wasn't. He inexplicably lost velocity, as well as command. Sick of trying to figure him out, they dumped him to the Mets for Xavier Nady (?).
Long story short, Peterson had his velocity back up to 96 last year and I saw a two videos side by side of his motion in New York compared to Pittsburgh. It looked as though Peterson had changed some things and he was throwing harder again.
Bottom line with Ollie is, don't write off his 2004 season. He did it all year and was terribly good. He has issues for sure, but I wouldn't rule out a 2004 repeat given the right coaching, which Peterson could provide.