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Presbyter (Greek πρεσβύτερος, presbuteros: "elder", or "priest" in Christian usage) in the New Testament refers to a leader in local Christian congregations, then often not clearly distinguished from episkopos, presbyter referring to ordinary elders and episkopos referring exclusively to the office of bishop. In modern usage, it is thus distinct from bishop and synonymous with priest. In mainline Protestant usage, the term is however not seen as referring to a member of the priesthood and terms such as minister, pastor and elder are used.
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The word presbyter derives from Greek πρεσβύτερος (presbuteros), the comparative form of πρέσβυς (presbus), "old man". The English word priest has presbuter as the etymological origin.
The earliest organization of the Church in Jerusalem was according to most scholars similar to that of Jewish synagogues, but it had a council or college of ordained presbyters (Greek: πρεσβύτεροι elders, priests). In Acts 11:30 and Acts 15:22, we see a collegiate system of government in Jerusalem though headed by James, according to tradition the first bishop of the city. In Acts 14:23, the Apostle Paul ordains presbyters in the churches he founded.
This does not mean that the episcopate, in the sense of the holder of the order or office of bishop, must have developed only later, or have been plural, because in each church the college or presbyter-overseers (also called "presbyter-bishops") did not exercise an independent supreme power; it was subject to the Apostles or to their delegates. An explanation suggests that the delegates were bishops in the actual sense of the term, but that they did not possess fixed sees nor had they a special title. Since they were essentially itinerant, they confided to the care of some of the better educated and highly respected converts the fixed necessary functions relating to the daily life of the community.
In Timothy and Titus in the New Testament a more clearly defined episcopate can be seen. We are told that Paul had left Timothy in Ephesus and Titus in Crete to oversee the local church (1Tim 1:3 and Titus 1:5). Paul commands them to ordain presbyters/bishops and to exercise general oversight, telling Titus to "rebuke with all authority" (Titus 2:15).
Early sources are not clear but various groups of Christian communities would have had a group of college or presbyter-overseers functioning as leaders of the local churches. Eventually the head or "monarchic" bishop came to rule more clearly, and all local churches would eventually follow the example of the other churches and structure themselves after the model of the others with the one bishop in clearer charge, though the role of the body of priests remained important.
From the 2nd century, it is certain that the offices of bishop and presbyter were clearly distinguished, the bishop was understood as the president of the council of presbyters, and so the bishop was distinguished both in honor and in prerogative from the presbyters, who were seen as deriving their authority by means of delegation from the bishop. Each Episcopal see had its own bishop and his presence was necessary to consecrate any gathering of the church.
Eventually, as Christendom grew, individual congregations were no longer directly served by a bishop. The bishop in a large city (the Metropolitan bishop) would appoint a priest to pastor the flock in each congregation, acting as his delegate.
The Roman Catholic Church, the Orthodox Church, the non-Chalcedonian churches and similar groups typically refer to presbyters in English as priests (priest is etymologically derived from the Greek presbyteros via the Latin presbyter). Collectively, however, their "college" is referred to as the "presbyterium", "presbytery", or "presbyterate."
This usage is seen by most Protestant Christians as stripping the laity of its priestly status, while those who use the term defend its usage by saying that, while they do believe in the priesthood (Greek ἱερεύς hiereus - a different word altogether, used in Rev 1:6, 1 Pet 2:9) of all believers, they do not believe in the eldership of all believers. This is generally true of United Methodists, who ordain elders as clergy (pastors) while affirming the priesthood of all believers. The evangelical (or ultra low-church) Anglican Diocese of Sydney has abolished the use of the word "priest" for those ordained as such. They are now referred to as "presbyters".
No Greek lexicons or other scholarly sources suggest that "presbyteros" means "priest" instead of "elder". The Greek word is equivalent to the Hebrew zaqen, which means "elder", and not priest. You can see the zaqenim described in Exodus 18:21-22 using some of the same equivalent Hebrew terms as Paul uses in the GK of 1&2 Timothy and Titus. Note that the zaqenim are not priests (i.e., from the tribe of Levi) but are rather men of distinctive maturity that qualifies them for ministerial roles among the people.
Therefore the NT equivalent of the zaqenim cannot be the Levitical priests. The Greek "presbyteros" (literally, the comparative of the Greek word for "old" and therefore translated as "one who is older") thus describes the character qualities of the "episkopos". The term "elder" would therefore appear to describe the character, while the term "overseer" (for that is the literal rendering of "episkopos") connotes the job description.
To sum up, far from obfuscating the meaning of "presbyteros", our rendering of "elder" most closely associates the original Greek term with its OT counterpart, the zaqenim...we would also question the fundamental assumption that you bring up in your last observation, i.e., that "the church has always had priests among its ordained clergy". We can find no documentation of that claim.
This response largely details the Evangelical Protestant understanding which rejects the idea of an ordained priesthood as is practiced in the ancient churches.