However - and I am not joking when I say this - I CAN'T WAIT till it's illegal. Because once it is, the mainstream will find out about it.. and THAT's when more people will really start using it, and after a brief panic-induced selling from wimps, the price will probably skyrocket. Even though it wasn't money, that's essentially what happened with Napster, Bit Torrent, the whole p2p movement in general. Once they make it illegal, that's when people will start using it.
I think the government is stuck between a rock and a hard place. On the one hand they want the dollar to be the universal currency, and yet they keep on putting all these restrictions on how it can be used reducing its competitiveness. They must understand that they cannot have the dollar as a universal currency while restricting its usage. Their hands in the fight with bitcoin are pretty much tied, because the more they encumber the US dollar to fight Bitcoin, the more desirable Bitcoin becomes.
I also think that a ban on the US bank accounts of MtGox is imminent. And this will almost certainly crash the price of Bitcoin. However, as you say that will not destroy Bitcoin. In fact it will make it stronger. However, people that have invested all their savings into Bitcoins, and worse who have actually over-leveraged themselves to purchase Bitcoins, will no doubt get hurt badly.
When dealing with a risky asset like Bitcoin I think it is very important to diversify. Besides, there is no need to put all your savings into it - that's just pure greed. Even putting a small fraction of your savings into bitcoin can lead to great returns.