"A hysterical academic, Lilian Edwards" oh yes? This would be the woman who said "I believe in copyright, I just don't believe in destroying the legal system to enforce it" (http://blogscript.blogspot.com/2010/03/day-democracy-died-deb.html)
The Guardian article you seem to be talking about (http://www.guardian.co.uk/technology/2010/mar/04/lords-digital-economy-bill) has this:
Lilian Edwards, a cyberlaw expert at Sheffield University, said that the new proposals had some benefits but also had sweeping downsides.
"For the first time, Sony and the rest can now go to court and demand that every ISP in the UK blocks YouTube," she wrote.
"There will in reality be no, or few, court applications - just non-publicised notifications. This is essentially legislation for cover extralegal censorship for the benefit of entrenched private interests."
I wouldn't call this hysteria, but the readers can now make their own minds up.
You report your boy as saying "that one safeguard specifically protected sites like YouTube" - whilst chapter and verse would be nice, I don't think we need to delve too far into the legal niceties to see what's going on. A discredited govt in its dying days is using an unelected minister, who has had to leave the commons under a cloud _twice_, to bring in a law (any law will do, so long as it's worth a seat on the board) that benefits it's mates in business. This is modified by some other unelected guy who's on £70 000 a year from a swanky firm of lawyers. Now I'm just guessing here, but I'd say this is going to be _another_ bad law. Rolling the turd in glitter isn't going to make it smell better.
No matter what happens to this poxy law, it will be swiftly circumvented by technical measures, eg IPredator, a truck load of CDs or what have you. The only sensible way forward for the content industry is for them to realize they have got lots of eager customers out there and find a way of giving them something they want at a price they are willing to pay; it's called a market economy. What they are trying to enforce here is a limited choice of goods at arbitrary prices: a bit like the USSR, now I come to think of it.