If we talking about the complete structure of the fediverse changing to connect to a single service (like abandoning Activity Pup and instead using a closed protocol that is controlled only by one company), then definitely Yes that is the worst idea even.
But since many fediverse services will simply not be able to use Blue Sky's protocol, because it is designed for a very limited use case, I don't even see why should talk about this.
However if Blue sky would adapt to the fediverse. It would only be a win for us. If they decide to not play by the rules they will be band. Fediverse is very robust and we don't need to be afraid of anything as long as we stick too our basic principles.
The path forward I think would be some sort of a bridge service. Think of it as a translation layer that could take in updates from both ActivityPub and AT, and present to the opposing side like it were native. Something similar was developed for nostr to communicate with the fediverse, and it seems at least feasible in this case as well.