No, I think this argument is largely correct. And frankly settled: anyone who's driven recent FSD beta versions knows very well that the cars "see just fine". They don't hit anything, they see and avoid obstacles. Frankly they're much more observant than humans are, my car will twitch when pedestrians turn as if they're going to enter the road (where human drivers mostly don't notice, and if they do they ignore it). What problems still exist are in planning: things like sign reading, lane selection, etc... still need some work. But collision avoidance just isn't an issue. It isn't. The LIDAR folks were wrong, basically.
(I will admit though that I'm a little sad about the removal of the ultrasound sensors though. It's true the autonomy probably doesn't need them, but I really like having the chimes to guide parking and garage maneuvering.)