This would mostly work if SMTP clients behaved appropriately in response to the 551 reply. That is to say, the 551 reply appears to have been specified more or less for this purpose.
Has anyone looked at what
a) SMTP servers when acting as SMTP clients do in response to a 551 ?
b) end-user SMTP clients do in response to a 551 ?
However for this to work, all SMTP clients in the entire world would have to be updated, if required, to do the right thing with 551. This is the problem. No amount of legislation from the Australian government will make this happen.
It could be then that email will be even more unreliable than it already is, with some email that is sent to the old ISP email address being delivered correctly (because the sender recognises the 551) and some email is bounced.
