With the new restrictions that mods can't retroactively become paid mods, nor can they be dependent on others sounds fine on paper.
But consider what having this kind of system in place will do for future games and mods. I believe this will discourage collaboration and ultimately will cause a decline in quality. If paid mods can't build off of others, then there would be less incentive or option to build integration of mods. Anyone remember mods like cobl, cm partners, and fcom for Oblivion? Those would be impossible with paid mods.
And since most modders would (rightfully so) like to maximize their income, I reckon many would exclusively make their portfolio be paid mods, even with restrictions on what they can build.
The mods made under these rules seem guaranteed to be shittier than others.
Appearance and armor mods are out - no Bodyslide.
Vast amounts of mods are dependent on SKSE, so those are out.
A lot of the coolest stuff these days is possible only with SPID and other such frameworks for mods to use. Those are out.
So, either this will cause a significant decline in mod quality if modders actually try to build for it (to say nothing of the cost - even at $0.50 per mod some of my installs would cost $500+)...or most modders will ignore it, and it'll go unused, cause it's too hard to make good mods under these limits.