That mind blast is pathetic.
Once per encounter? Daze? Good lord. That may be the biggest design nerf I've ever witnessed-- and I am not one to cry nerf willy-nilly.
First of all, in 3e, it's already vulnerable to Lesser Globe of Invulnerability. It's a 3rd level spell effect. If you know you're going to be facing mind flayers, I recommend carrying this spell.
(I'll note just for the record that the Heal spell removes the stunned condition, but as it's a 6th level spell I don't consider it a sufficient trump for a CR8 creature.)
I'd much rather they had left the power of the ability alone and tied it to the bloodied condition, either on the mind flayer's side or the targets'. If it were an ability that the mind flayer could only use under sufficient duress, or which he can only use on seriously wounded targets, that alone would have been sufficient to mitigate its "surprise round TPK total spoiler" status.