Are you saying that this template is what the article is presenting? If so I don't believe it applies, in particular because you have stated that only a partia

Are you saying that this template is what the article is presenting? If so I don't believe it applies, in particular because you have stated that only a partial compromise on C is needed to prevent Y and Z. There is no "partial compromise" on encryption, so this argument is flawed. There is no way to have encryption that "only the good guys" can break. It is either secure, or it is not.