IMO the idea of "burning" (some people call it "freezing") is less worse than idea of redistribute Bitcoin from all vulnerable address, which also bring debate on how to perform the redistribution.
For re-distribution, there would be a quite easy and uncontroversial method: adding the coins to the future mining rewards to make the halving curve a bit smoother. IMO if this is an option the rewards should be moved into the far future, for example when the regular reward has fallen below 0.1 BTC or so.
Distribution method you mentioned definitely less controversial than other method i've seen. But aside from hard fork, it also add some technical complexity about changed mining reward & which Bitcoin from which vulnerable address/UTXO should be taken.
Would that be how the actual redistribution takes place? Or is it actually just a
free-for-all treasure-hunting of vulnerable funds?
Moreover, what will probably happen is an exclusive and elite race, one which even Bitcoin developers and contributors couldn't join. The participants would only be those who have the resources. Who knows, it might even be the Lazarus Group who'd first acquire quantum computing capabilities to break open people's wallets? After all, they're trained, financed, ran by a government.
Perhaps we can only think of a proper redistribution after being certain that those vulnerable funds are recovered by saintly actors, which we cannot. Otherwise, perhaps rendering those QC-vulnerable funds
unspendable is the most practical thing to do. And perhaps ethical, too.