I want it to behave like every other text input field on my Mac. So I can do option+left/right to jump words, Cmd+left/right to jump to beginning/end of a line, shift + move cursor to highlight text, Cmd+A to select all, option + forward delete to delete the whole word in front of my cursor, etc

what’s wrong with the standard terminal then?

It does none of the things I mentioned

Option+left/right works, but that's it :-]

The emacs-like keybindings are default for bash (and probably zsh too). So you need zero lines of configuration, just the awareness that they exist.