I notice that all these labels start with 'k__Bacteria', so you could change the color legend title to 'Bacteria' and remove this prefix from the taxa themselves. You could also remove the prefixes like p__ and c__ from the taxa strings.
To make things even simpler, you could merge ASVs based on taxonomy and plot that instead, just like you suggested!
Merging / collapsing / conglomeratinging features by taxonomy reduces resolution and introduces classification bias! But it sure does simplify visualizations!