Your approach is similar to what is currently implemented: there is no yield until all BitUSD is reclaimed as fees.
I don't think it is the same. If a sudden price feed correction happens that causes all of the shorts to be margin called and placed at the new price feed. However, this new price feed would be so high (in BTS/BitUSD) that some of these shorts would not be able to collect enough BitUSD if their order was matched to pay off their BitUSD debt to the network. Let's assume that after many of these margin calls were matched, the BitUSD debt they owed minus the BitUSD they collected from the matching is greater than the amount of BitUSD in the yield pool. In that case, the current system should be left with 0 BitUSD in the yield pool, some BitUSD liabilities by the network that is not backed by any of the remaining short positions, and the remaining short positions margin called at the price feed (but not yet undercollateralized at that price).
Now this undercollateralization (let's say the deficit is 1000 BitUSD) causes everyone to panic and get out into BTS while they still can. I will assume the price does not adjust any higher (in BTS/BitUSD) to cause more of the remaining margin call orders to become undercollateralized. Even with that assumption, in the current system (actually not the current system, but a system very similar to the current one but where the markets didn't freeze as a result) some people could be left with worthless BitUSD. If I have 1000 BitUSD in my wallet and am slow to move (everyone else moves into BTS before me), all the short positions will be covered and I will be left with 1000 BitUSD with 0% backing. Furthermore, everyone knows that if a new short was to be created, the system would start in a state of undercollateralization.
So how is that different from what I am proposing? Well, in my proposed system, the moment in which undercollateralization occurs (assuming the yield pool has been depleted already), everyone's BitUSD is split into BitUSD and BitUSD-IOU. Let us say there is an outstanding supply of 1,000,000 BitUSD. Before the undercollateralization event, the short positions collectively owe the network 1,000,000 BitUSD. The black swan happens, the price feed adjusts, the shorts are margin called. If placing any short's margin call order at the price would cause it to be undercollateralized if matched, then the system has to do something different. It first considers that short position the property of the DAC (meaning the owner of that short won't be getting back any BTS at all). It takes the collateral from all of the shorts matching that condition and determines how much BitUSD it could get with it at the price feed. It then calculates the amount of BitUSD it is missing to pay off the collective debt owed by those shorts. Let's pretend that the deficit is 1000 BitUSD. In that case what it conceptually does is convert 1000/1,000,000 = 0.1% of all outstanding BitUSD in the system into BitUSD-IOU (owned by the same owner as the BitUSD converted) and it prints up the 1000 BitUSD and holds on to it to cover the deficit when those undercollateralized short margin call orders are matched. The outstanding BitUSD supply is still 1,000,000 BitUSD, which is the same as the debt owed by the network. However, the remaining collateralized shorts + the BTS collateral at the price feed which was collected from the undercollateralized shorts give the network to claim to 999,000 BitUSD worth of BTS assets (at the particularly BTS/BitUSD price feed). Also, there is an additional 1000 BitUSD-IOU liability by the DAC that is held by the original BitUSD holders. As the price feed adjusts, it will also make the necessary adjustments in the BitUSD vs BitUSD-IOU distribution in order to maintain the amount of BitUSD necessary to cover whatever deficit occurs. That means if the price goes back up, the DAC could return the BitUSD that it held to cover the deficit back to the BitUSD-IOU holders (in exchange for destroying those BitUSD-IOUs). This all happens automatically in the blockchain without user intervention necessary.
The point is that if Alice is moving faster than Bob to liquidate into BTS, she won't really gain an advantage based on the information she has (she may have an advantage or disadvantage as the price changes in the future just like anyone does currently, but no one can predict the future). If Alice has 999,000 BitUSD and Bob has 1000 BitUSD in their wallets, then the undercollateralization event described in the above paragraph would cause 0.1% of each of their stakes to be converted to BitUSD-IOU. Alice will have 998,001 BitUSD and 999 BitUSD-IOU, while Bob will have 999 BitUSD and 1 BitUSD-IOU. If Alice buys BTS at the price feed with all of her BitUSD, the DAC will have some collateralized margin called shorts remaining that collectively provide the network a claim on 999 BitUSD worth of BTS assets (999,000 - 998,001 = 999), and the network will now owe a debt of 1,999 BitUSD (but it holds 1,000 BitUSD collected through the 0.1% tax, so in reality it is a 999 BitUSD debt owed). Now, assuming the price stays the same, Bob can come along anytime later and trade his 999 BitUSD for 999 USD worth of BTS (which the network still has assuming the price had remained the same). This would close all the remaining margin called shorts (which means the network would not have any more BTS assets to back the BitUSD market), and reduce the debt owed by the network to 1,000 BitUSD. But that is exactly the amount of BitUSD the network was holding to keep things balanced, so it can just cancel the liability and assets out and be left with zero BitUSD debt and zero BitUSD assets. Finally, Alice is left with 999 BitUSD-IOU and Bob is left with 1 BitUSD-IOU. These assets will likely be worthless.
Your graceful approach is similar to Mt. Gox experiencing a black swan event and then attempting to gracefully recover by selling bonds that it would take "for ever" to pay off.
So, what if it does? If it never pays off its bonds it is equivalent to charging all of its holders a percentage tax on their balances to make itself whole. That is better than a bank run that could leave certain slow movers with nothing.