You seem to only be considering the fuel saving of the higher altitude. If we're considering a ground based mass driver launch, rather than a conventional rocke

You seem to only be considering the fuel saving of the higher altitude. If we're considering a ground based mass driver launch, rather than a conventional rocket-only launch, then I think there would be a substantial practicality gain from firing into thinner air. At the proposed 5000mph, air resistance at sea level would be tremendous. Greater atmospheric losses would entail either bringing more fuel to complete the orbit, or larger launch loop / greater acceleration force.