GR (Gwoyeu Romatzyh [Luomaatzyh]) is not inconsistent. It only seems that way because you are thinking in terms of Western, phonetically-based spelling conventions. In Western languages, one individual sound (phoneme) = one written form (grapheme) is the ideal. Spanish does this sort of thing much better than English.
GR spelling makes a lot more sense when you consider the sound system as a whole (the phonological level). Consider this: English has over 10,000 different syllables (think about sit, sits, spit, spits, split, splits, all impossible syllable structures in Mandarin).
The Mandarin sound system is profoundly different from English: if you ignore tones, Mandarin only has 400 syllable types. If you want to learn Chinese well, you need to get a feeling for syllable structure. GR and bopomofo both help you do this because they operate on the syllable level: one syllable type = one written form.
How does GR spelling work?
C = initial consonant, V = main vowel, v = i/u/iu (medial vowels:ㄧㄨㄩ)
In GR, all 4th tone CV syllables (open syllables) are written with an [color=#FF0000]-h[/color]:
lu[color=#FF0000]h[/color], ma[color=#FF0000]h[/color], pi[color=#FF0000]h[/color] (road, scold, fart). Mnemonic: [color=#FF0000]h[/color] ends with a [color=#FF0000]downstroke[/color] (4th tone is falling)
All 4th tone -ng syllables are changed to -n[color=#008040]q[/color]
Jen[color=#008040]q[/color], min[color=#008040]q[/color], fan[color=#008040]q[/color] ([a surname], fate, leave). Mnemonic: [color=#008040]q[/color] ends with a [color=#008040]downstroke[/color] (4th tone is falling)
In GR, most 2nd tone CV syllables (open syllables) are written with an [color=#FF0000]-r[/color]:
pa[color=#FF0000]r[/color], she[color=#FF0000]r[/color], po[color=#FF0000]r[/color].por (crawl, snake, mother-in-law).
CvV syllables belong to a different group, so they are spelled differently. The medial vowel letters are modified, so no extra letters are needed – very economical.
1st tone: chian, chuan, chiuan (lead [metal), wear/put on, circle)
2nd tone: ch[color=#008040]y[/color]an, ch[color=#008040]w[/color]an, ch[color=#008040]y[/color]uan (money, boat, all/entire)
You asked why GR uses ell instead of er for the number two? The answer is look at the overall system:
1] Sorry, the letter r is too busy representing 2nd tone
2] Besides, only a handful of words use the retroflex -r (unless you are transcribing spoken Mandarin). Using -l is a minor inconvenience.
“Why not just use -h for all 4th tones?” you may ask. The reason is because GR was designed with economy in mind. Most spellings are quite compact: there are few extra letters. If you compare an average page of Chinese rendered in Hanyu Pinyin with the same page rendered in GR, the GR is much shorter and much less cluttered. I’ve written a research paper discussing this topic.
An explanation of National Romanization in pure text form is not so clear. It is much easier to understand if you see everything laid out as a series of neat tables, one for each syllable type. I will be starting a specialized website to explain GR, so I won’t give any more examples here.
Hanyu Pinyin is OK for Chinese people who already know the Chinese sound system. Using individual symbols for each phoneme, as in Hanyu Pinyin, is reassuring for Western learners, but causes subtle problems in the long run.