1. Block times adjust, but there is an upper limit to adjustment per block. Low-pass filter, sort of. 2. In the event of compute power loss, prior to adjustment you still have to mine blocks of previous difficulty. 3. In the event of compute power loss, block times increase and there is no other solution than to wait it out or fork. 4. In the event of sudden and significant compute power loss block times increase to such a level that running the network under previous difficulty and waiting it out becomes impractical, therefore the only practical solution is a fork.

AFAIK it adjusts after a fixed number of blocks have been mined. So if 99.999% of your compute power is gone, you won't be mining enough blocks to adjust the difficulty for a very long time.

The adjustment happens every 2 weeks. It's unlikely that miners would go offline simultaneously across the globe to the extent that it would completely grind the network to a halt.