I'm sorry, but I fail to see the confusion here.
Designing other apps/protocols on top of the blockchain (big B Bitcoin) can be confused with the currency (little b bitcoin). There needs to be a differentiation between the protocol and the tokens.
I don't think so and don't see the confusion. Bitcoin is the whole system but the coins are what you own / spend. People know which you're referring to given the context.
I agree there's not much confusion now.
But imagine developing upon a protocol called the Dollar and you spend dollars. It'll become a more confusing term in the future if bitcoin ever becomes a mainstream currency. The blockchain is MORE than just a currency.
In my opinion the currency is bitcoin and the technology is the blockchain. Pretty simple once you look at it that way. Things will be built on top of the blockchain not bitcoin. I don't see the issue.