Yep, it's pretty bad, it sets a bad precedent, and has me looking for alternatives.

When it was originally announced I got the impression that Google would soon be removing the ability to sideload apps altogether and as I almost entirely use apps installed from "untrusted" sources this would have been a nightmare for me.

So while I think this whole situation is shit, and will almost certainly lead to Google removing the ability to sideload apps in the future, for me the immediate anxiety has been lifted.