. So if he dies (God forbid) or something bad happens to him, you expect ETH's market prices to go all the way down the drain in an instant. It's likely ETH will become worthless after this.

hey mate are you scared of his death?
After all Satoshi have been unavailable for God knows how long and bitcoin is steal doing fine.
Death is inevitable and everyone will test death at some point, but putting a proper system on ground os what make the project to exist e long after it creator, and in Ethereum case, the recent transfer of network have opened them up for a lot of things and we can't accurately say what will happen in the future.
But we have to always have it at the back of our mind constantly that centralization is higher risk must, especially in technology that have high risk like crypto.