1. The Bitcoin Foundation is in no way associated with these jokers (neither is DATA, as far as I know).
Peter Vessenes is the one who got this ball rolling, and he's one of the founders.
Perhaps the current makeup of the Foundation is less inclined this way, but the damage has already been done.
2. No sane US merchant will cooperate unless they are required to by law. You don't turn away customers, or make them jump through extra hoops to pay you.
They will be, at least any of them under FinCEN jurisdiction.
Even if we stop this initiative, though, they'll just start over and just not announce it next time. US law allows/requires them to do this.
3. All merchant associations (BF,DATA, etc.), especially those whose members are mostly US based, will be the ones most hurt by this system becoming legally required.
I very much hope so. I sympathize with the people in the US who have tried to play by the rules and do the right thing just to be allowed to operate, but Bitcoin is more important than any individual business.