Thanks for sharing your thoughts - Great read!
Imo, the use case of bionetrics as your seed phrase has another anngle: As you said, blockchain and crypto is based on the idea of freedom, but with this freedom comes the responsibility to take care of your assets (your seed phrase) which no one else can do for you. Keeping your seed phrase accessible, but also safe from destruction and theft, is not trivial at all.
That being said, having a fail-safe mechanism by using your face for recovery might be a welcome trade-off between privacy and safety.
Cheers
RE: The System Can't Be Fixed