Very true, but in the context of an LVT, it shows a possible downside: if it's high enough, you're taxing away the majority of the site value, and so these people don't even have the silver lining of a big increase in home value to cushion them when they move.

Well by design, LVT discourages having land be the majority of your home's value. E.g. Single Family Homes are fine in the outskirts of the city where land is less valuable, but LVT encourages building up the more valuable parts of the city (e.g. downtown, next to the subway station).

In both cases (SFH on less valuable land, condos on more valuable land) the land shouldn't end up being the majority of the value, since with condos the land value is effectively split among all units in the building.

Yes, I was agreeing with that and pointing out that the defense of "at least they have the gain in home value" wouldn't apply to the high LVT case. Whether it's good for pricing to work like that is a separate question.

Well, this hypothetical woman isn't collecting any profit while she still owns the home. Equity is useless until you sell.