> Increasing capacity at bottlenecks along the way

This would presumably amount to building a slightly shorter but nevertheless very long cable on/under land. And I think it's much easier to just drop a cable under the sea than it is to dig and bury it under the ground or build pylons to carry it above the ground.

This is true. In my experience constructing additional pylons is always a bottleneck.

Not necessarily. The shortest maritime path crosses at least one country maritime economic exclusive area, that will have to agree on that, without reaping any meaningful benefit. Plugging by land is easier to negotiate, maintain and finance, as the connection can also be used by those countries. I'd guess the reason this isnt being done that way is both because the UK left the EU and the whole Gibraltar debacle. I may be wrong on this, but the whole thing just looks like UK being UK - trying to solve their problems while ignoring the rest of the world exists.

I think building new subsea power transmission is cheaper per mile than building over land.

If you need to upgrade most of the links along the way, then building the longest possible cable at sea makes sense.

There might also be plans to tap off this cable to feed into portugal, spain, france and ireland along the way - that allows the cable to also take the role of some of the local transmission grid