It's a huge price to pay for a user who doesn't understand that their decrepit app is the reason the rest of their phone doesn't work as well as it used to.
The simple solution is for developers to recompile the apps. The developers of any apps that are truly still needed by customers, can easily convince those customers to pay for the update.
But the phone worked "as well as it used to" on iOS10 with support for 32bit apps. So why would it not work as well as that? I think what will happen is the user don't understand why their precious legacy app doesn't launch at all.
Also, they could just continue to pop up an alert saying "this app may slow down your phone" like they already did in iOS10.
Also, I doubt there is much of a performance hit anyways. For example, the current facebook app is 64bit and it is a slouch to start.
A few hundred megabytes is certainly a small price to pay for users who need those legacy apps to unlock files/documents stored inside or the features the app might to provide to interface with legacy IoT devices or even a car.