Just because there exist methods to work around a statutory scheme doesn't mean that the scheme is without value or should be binned. The Police have the power to arrest people, however some people work around that by arming themselves, putting on a Hiljab etc. it doesn't mean that arresting people doesn't work, just that it ain't perfect.
Most people in the UK are entirely incapable for searching for, selecting and operating a VPN connection for the simple reason they haven't got a clue what one is or why they would need one. It's therefore a pretty poor argument to say "let's not bother attempting to protect peoples work because some people can work around it, and a minority proportion of those will work around it".
The idea that the entirety of YouTube will disappear due to this legislation is pretty laughable. I don't mean to be mean, but seriously - if you actually use YouTube you'll see that they have a particularly robust copyright infringement policy. It would therefore be extremely unlikely that the legislation and policy would be so at odds that YouTube were blackholed. If you disagree I would welcome any examples that may reasonable come to pass.
(e) is an interesting part, and well lobbied for. It doesn't give you free reign to copy material that is currently unavailable, but the courts will give consideration to the point. As an example, if you download a deleted song that will never be released again for your own personal use you may be able to use (e) as a defence. It's no guarantee, but the courts will give due consideration to it.
On the other hand, if you download a Disney film that is currently unavailable but on their release list for 2015, it is unlikely that (e) would hold as much sway - they fully intend to make the material available at a cost and it is clear to the public when that will be. It's therefore not a panacea for people downloading in-copyright material, but it brings some reasonableness to proceedings.
The 50 letters procedure is presumably intended to please the courts who are busy enough as it is. If 50 letters doesn't make you think twice then you're going to risk incurring the wrath of a County Court judge for wasting his/her time. I personally would consider stopping at around 20 - you're clearly on someones list...