Or, alternatively, it would have required shells at minimum to understand these new modes so that they could still let you type `tputs ...` to recover from apps

Or, alternatively, it would have required shells at minimum to understand these new modes so that they could still let you type `tputs ...` to recover from apps putting the terminal into that mode but not restoring the terminal to its previous mode upon death/stop. This subtlety is the crux of the issue. There's already precedent for input features that the program can opt-in to using output escape codes, like bracketed paste mode. But these don't change input so radically that they'd stop you from using your shell if the terminal was left in that mode after a program crash. Maybe you could make it work by saying that key state event mode is automatically disabled after every newline from the terminal and the program needs to explicitly re-enable it?