i gather he had to burn coin from his miners built in fee address so it had to be eth from that particular address, not btc.

Why burn at all though? Could he not just have signed a message from that address confirming his PGP key?

I know but ever heard the saying "don't put all your eggs in one basket?

Who's to say that is all their eggs? Perhaps they have several such addresses.

Now instead of being 160-bit secure, they are down to 128-bit security level.

All bitcoin private keys provide "only" 128 bits of security.