I pretty much agree with you. To an extent, the Wikipedia Foundation (I am an active editor of Wikipedia, and I only found out about this issue today because of a quirk in my Wikipedia set-up) has over-reacted but also under-reacted While for past editing, there is the danger that Italy could demand the IPs of any entry content in ANY Wikipedia article, not just those in Italian. In particular, there might be "attacks" on articles on Italian subjects in other Wikipedias (e.g., the English, German, Dutch, Spanish articles on Berlusconi, Fascism, Napoleon, popes, Italian soccer teams). For future Wikipedia entries, especially in Italian or about Italian subjects, Wikipedia should consider some sort of voluntary re-direct so that there is no evidence of what legal jurisdiction content has come from. FYI: Wikipedia in Italian is served in Florida.
China (re Google) and Britain (re Twitter i.a.) have also tried to restrict the Internet with differing success.