>I was wrong. 100% wrong. Not only did our site metrics not suffer in any way, but tens of thousands of people signed up to the newsletter and it became a much more important communications and conversion channel than it had been.

You were absolutely correct that it's a bad experience, and that probably a lot of people hated it and think less of your company for doing it. But since every site behaves this way it's not a deal-breaker for people anymore. People either find a way to get around it or just suffer with the crappiness of the modern web and your metrics just go brrrrr.