Legitimate interest is a way for the vendors to not need your confirmation. In general, your right to privacy is valued against the vendor’s right to operate. The most often used example is advertisement: in general, vendors are allowed to advertise, as they want to operate and sell their products. But you have a right to your data (e.g. mail adress, home adress, interests…). So courts have to value what is more important. Another example that most people would agree is that clubs want to show what happens in the club, so they publish pictures from their activities (interest of club to show they are active vs personal right to your image). As not every case goes to court, most vendors see their interest as more important and interpret “legitimate” interest rather loosely. So in general, the idea of legitimate interest is compliant with the GDPR, although I believe most sites use it too liberal.

A notable exception would be Robert Jordan and his Wheel of Time series. He prepared notes so someone could finish the work and his widow picked Brandon Sanderson to finish the series. But I think it feels easier to milk it than to be thoughtful with the life’s work of someone, as this requires a lot “would he have liked it” and to know this you would have to start caring early.

That is actually really close to what is present now. The EU never said “use cookie banners” but rather “if you really want to track people, they have to say yes”. And most commercial websites decided to make it hard to say no, now everyone blames the EU for doing so. Your second point is not yet implemented, this would be really good for consumers.