I think the proposal isn't a choice between keeping it or abolishing it, it's a choice between keeping it compulsory or making it optional. I quite like the idea of optional subfusc. I would probably wear it for my first and last finals and then wear something more comfortable for the middle ones. The idea of post-finals celebrations not being in sub-fusc seems a bit weird now that I've been at Oxford for 3 years. I think if I were still involved in OUSU I'd vote for having a referendum, it makes sense to give students a direct vote on such an issue, as I'm sure there's lots of different individual opinions about.
I think the point about sub-fusc deterring applicants is a relevant concern. Although it's a fairly irrational fear it adds to the general perception amongst lots of applicants that Oxford is a different world, in which they do not belong. Things about Oxford will always add to this perception: colleges, architecture, traditions, drinking societies... but it doesn't mean we necessarily have to abolish them. I think it's important to get out the message that they're essentially superficial features and doesn't define Oxford.