This is my take.
WotC has announced their biggest goal is control over what is attached, even peripherally, to the D&D brand. Royalties, claiming IP, none of that was as important as having the power to control what is considered "D&D compatible". WotC wants to avoid some potentially controversial product proudly displaying "Compatible with Dungeons & Dragons" and them having no recourse. They are doing their very best to move the game from "Satanic Panic of the 80's" to "quirky storytelling game of Let's Pretend" and sell it to teens and parents who watched Stranger Things and think Chris Pine is dreamy. They don't want some Hard R product muddying that water.
You can see it in there licencing model: the closer the game looks to D&D, the more control they have. The CC stuff is as broad as can be; you can make an RPG with it, but not really a D&D-looking one. The lack of races, classes, spells, and monsters (you know, the stuff that people associate with the game) is done to stop another Pathfinder game taking all their game elements and making a clone. If you want access to all those game elements; you have to agree to WotC's content moderation (which looks like the standard is "don't make us look bad"). Need D&D's actual IP? DM's Guild gives you the actual ability to use it, but with even tighter restrictions (and some revenue to boot).
So, like you, I believe the fight to keep 1.0a is a bit of lost cause. I don't know what the WotC "nuclear option" (deauthorize 1.0a and replace it with... nothing?) but I have a hard time believing there is any path forward that ends with 1.0a surviving. WotC right now is negotiating what it would take to get enough people to accept its demise and replacement. Fight for 1.0a, but if WotC's hard stance is no, then the fight must be on making 1.2 the best it can be for us. We still have the ability to mold 1.2 farther in our favor. If the line is 1.0a or death, we're getting death. If the line is 1.2 but we demand further concessions, we have a good chance of getting those.
Don't let the perfect be the enemy of the good.
I've come to the conclusion that WotC really doesn't care about 3PP content. They're not worried about another Pathfinder stealing 1D&D's thunder, they don't care about the revenue the 3PP market is generating, they probably don't even really care about hate speech content, at least not to the extent they've claimed. The endgame here is ultimately VTT. They have absolute dominance of the print RPG sphere. What they're worried about is someone using the 5.1 and/or 1D&D SRD to create a super awesome VTT that could rival the DND Beyond one.
To that end, they want to put strictures on how their SRD content can be used in VTTs. OGL 1.0a didn't give them this power. Ergo, they need to switch to a license that does, and at the same time invalidating the current OGL as far as their content goes.
The royalties and all that other stuff in 1.1? That was just, "Since we're doing this anyway, let's shoot for the moon and see what we can get." Given how quickly and easily they dropped it, I don't see the existing 3PP print market as being something they really care about. The key here is the VTT policy.
My prediction is that at the end of this process, we'll see something largely akin to the status quo vis-a-vis print 3PP content. It might require some contract language wrangling, but we'll end up with something that allows existing 3PP under 1.0a to continue being printed and sold, previous OGC to be sub-licensed, and any new content under a truly irrevocable license. The various loopholes that people think are trojan horses will be wrapped up, and the morality clause that is their public-facing fig leaf justifying the whole procedure will be modified to terms widely accepted by the community. The VTT policy will even be modified some to make to more palatable to the community, without losing the restrictions that WotC wants to place on DND Beyond competitors.
When OGL 1.0 was first conceived and disseminated, WotC wasn't in the video game/application making business. Any such development would be licensed outside the company anyway, so what did they care if someone made a video game or electronic tools using the SRD? Now they are in that business, so OGL 1.0 is no longer compatible with their needs.
So I agree with those saying 1.0 is a lost cause. They need it gone to take back control over digital content, the core of their development strategy under current leadership. I don't see any outcome that doesn't end with 1.0a "de-authorized." The best case scenario (at least until there is a challenge in court, if any) is that 1.x will offer functionally the same terms as 1.0a, but only for print and "static media", with options for VTT producers limited under their VTT policy.