Probably, readability. Daniel probably assumed that his readers either a) wouldn't get why those distinctions need to be made, and would therefore be put off by such a bludgeon of an opener or b) would just read on already to see these details explained.
First, the login environment is really tangential to the discussion here. He's trying to talk about the fact that their threads' stacks were taking up too much reserved space for memory protection and how they slimmed those down. Precisely how big they are and why that is doesn't really matter, all that's important is that they're a couple orders of magnitude larger than they need to be (whether this is a real issue I leave for later ;-).
Second, if you read on, you see that the whole article is about threads and it soon doesn't matter that he said "process" in the first sentence. Maybe just replacing it with "thread" would be good, but it's really not a big enough deal to get bent out of shape over.
I really don't know about your third point, I've never run in to this particular issue and I don't know if spawning tons of threads actually wastes physical memory for this protection (doubt it), destroys the page table (this would be my guess), or something else (somewhere, I can imagine the sound of something thrashing). [EDIT: on re-reading, it appears the concern was virtual memory, and the page table is definitely where I heard that thrashing sound earlier. I now clearly see where they had performance problems with 10MB stacks, even on a 64-bit architecture] It sounds like there actually was a bottleneck, and I trust that these guys didn't just imagine it (though they could've explained the problem a bit better, I think). I agree with you that I wasn't convinced by "threads are too expensive" but I think I trust this is a fault of omission, not of research.
For my part, I can't get my head around your rewrite. Certainly those details are important, but they don't belong in such high density in the first sentence of a blog post, even a highly technical one. It's a matter of writing style, and I think Daniel made the right choice.
Regarding userland threads, I don't think these guys are developing (or probably testing at this point, though I'd be glad to hear if they were) on freebsd. That's the only place I know of with something actually called "userland threads"; there are several implementations on linux by different names that accomplish the same goal, but I don't recall seeing any with that name. Which threading scheme in particular were you referring to?