I think there are 2 claims which this article conflates. I'll jokingly call them "Weak Whitney" and "Strong Whitney".
"Weak Whitney" is the claim that this very terse style is comprehensible given sufficient study. I find this plausible.
"Strong Whitney" is the claim that in many circumstances this style is _better_ than a more normal style, with full variable names, whitespace, etc. I am much less persuaded by that claim. When the article says things like "Note that d probably stands for “dimension” or perhaps “depth”; I’m unsure on this point." I'm like, yes, congratulations, that is exactly the point of using more descriptive names and/or comments.
I don't think we have enough information to conclude exactly what happened. But my read is the researcher was looking for demo.filevine.com and found margolis.filevine.com instead. The implication is that many other customers may have been vulnerable in the same way.
Lawyers can and will send cease and desist letters to people whether or not there is any legal basis for it. Often the threat of a lawsuit, even a meritless one, is enough to keep people quiet.
ArXiv has always had a moderation step. The moderators are unable to keep up with the volume of submissions. Accepting these reviews without moderation would be a change to current process, not "just like arXiv has always worked"
"As soon as profit can be made" is exactly what the article is warning about. This is exactly the "Human + AI" combination.
Within your lifetime (it's probably already happened) you will be denied something you care about (medical care, a job, citizenship, parole) by an AI which has been granted the agency to do so in order to make more profit.
I didn't totally follow the issues with keeping the data in memory, and it sounds like it is solved now - but you could probably use a cardinality estimation algorithm to estimate the number of unique beacon IDs while only using constant space. https://en.wikipedia.org/wiki/Count-distinct_problem