But why does the fork have to make the existing outputs unspendable? I know it is possible to make any sort of fork, but who is proposing anything that would make these locktime tx unspendable?
There could be a locked 200kB transaction that spends some outputs and where an alternative transaction can no longer be created (private keys lost and/or multisig outputs).
There isn't. 100kb is a
huge transaction (100 times bigger than a "normal" large transaction). IMO, that's a perfectly acceptable threshold. If larger is needed, you can always create a second transaction.
The "one every 100 blocks" exception really isn't needed here. It's more cool than useful.