No, payment networks verify that the user can spend immediately. That is full confirmation in a few seconds. Bitcoin fails dismally here...

To call a credit card transaction a full instant confirmation is disingenuous at best. If I were selling goods I'd prefer the 0-confirmation Bitcoin transaction to a credit card transaction. And just like how you might refuse a credit card payment from someone without an id, you might also refuse a 0-confirmation Bitcoin transaction with no or very low transaction fees.

In that case you have no idea if that transaction is actually confirmed and not a double spend (typically Bitcoin requires at least minutes to confirm), that's not equivalent to them paying you by bank transfer in seconds.

That's correct, but it's not a fair comparison for his example, as no one on Craigslist will send a bank transfer to you. Judging from context mrb was comparing it to a credit card transaction, which you can do with PayPal and their free credit card reader that goes into your audio jack. If some stranger on craigslist wanted to buy something from me with either a credit card or a 0-confirmation Bitcoin transaction, I'd chose the Bitcoin transaction. Perhaps you underestimate the difficulty in performing a double spend. Or underestimate the amount of credit card fraud that happens.

You also mention the energy cost as a concern. It was estimated that the energy cost of running the Bitcoin network was $400 million in 2016. Bank of America listed $60 billion dollars in just operating expenses for that same year (and this doesn't include investment losses). Sure there is a lot more going on at BAC, but even if only 10% of that is spent verifying transactions, it still cost more than all of Bitcoin. And that's just one bank.

Since this is just the POW algorithm, increasing the blocksize or using an off-chain solution to increase number of transactions won't cause a scaling in POW energy usage. The POW algorithm costs just as much energy to confirm 1 transactions as it would 1 million. All that energy isn't spent doing math to confirm the transactions, it's confirming the "signature" on the block which lists all the transactions.

complexity meaning average users hand their entire savings over to someone else

Ignoring the fact that you've certainly handed your entire savings over to someone else, I'd like to see the sources for this. Things are so simple now. It's gotten so easy to store Bitcoins on your phone or computer. You don't need to download the entire blockchain anymore, and you can backup your entire Bitcoin wallet with 12 words, which you can choose to memorize or hide somewhere.

... making it extremely vulnerable should it become popular to being targeted and cornered by states or money markets

I would argue it's already become popular. And I think Bitcoin being banned by state entities is probably it's biggest vulnerability at this point, but with so many businesses involved in it, I don't see that happening. In fact, things actually seem to be going the other direction. Bitcoin has officially been made a currency in countries such as Australia and Japan.

... hidden centralisation through miner cartels running the transaction network

If these miners were in America, with 8 to 10 different companies mining the majority of Bitcoin blocks, no one would be saying anything. But when you have the same thing in China, suddenly everyone is afraid of secret miner cartels.

... and a small group of devs/companies producing the complex software required

The core Bitcoin software is open source. It can be inspected for vulnerabilities at any time, and with so much money in Bitcoin, it's being looked at very closely. Being open source also means people can make their own versions at any time. I know of two popular projects hoping to grab the official Bitcoin name right now. And sure if such projects get popular enough, and far enough along, the community could break out into an all out war. Each side trying to find as many vulnerabilities in the others' software as possible. But whoever wins will be the most organized, and the ones who makes the best, most stable, and most reliable code.

... it appears to be designed for something else entirely (to replace fiat cash it seems, which is on the way out anyway).

I do agree that Bitcoin has many traits of cash, such as irreversibility and pseudo anonymity. But I don't think it's "just enough (anonymity) for criminals". Banks can trace serial numbers on bills, and Bitcoin can be traced from transaction to transaction. Both can be traced when spent and you go in person or have something shipped to you.

However, Bitcoin's similarities to cash don't leave it dead in the water. Imagine what people thought when the first printed bills started being used, "Oh too many problems here for this to ever be a thing. What's to stop them from printing double the bills? Coins have intrinsic value and when I receive one I have the value instantly."

The "solution" to the scaling problem spoken about in the article allows off-chain Bitcoin transactions (by fixing transaction malleability). This allows for layer 2 services, and these will have a lot more in common with credit cards. The big one you've probably heard of it the Lightning network, which should allow for millions of transactions per second with complete and full confirmations in < 1 sec, and yes, with no chance of a double spend. There's no reason someone couldn't offer a service that also plays mediator for shoddy goods. Bitcoin might seem rather limited now, but it's by no means hit a technological dead end.