That wouldn't end Bitcoin. It might make some trouble, but even that wouldn't that big.
Even if you could drop the hashrate 50%(which is complete bullshit, since if it drops miners with older hardware just go in again), that just means double confirmation time. So what? It adjust after 4 weeks instead of 2 weeks, big deal ...
why would miners with old gear go in on high difficulty?
The hashrate doesn't make a difference for them, the difficulty does.
Well, we assume a further decline as time passes eventually leading to everyone drop out.
And there you are wrong. The overall hashrate tells them if they find the block or somebody else finds the block. The difficulty just tells them how long it will take them(or someone else) to find it.
Why would we assume a further decline? Everybody knows, that there will be a new adjustment in 4 weeks max.
clones of bitcoin died this way before.