Personally I am in favour of this ban, I've seen so many adverts for unpaid internships (generally in highly competitive fields like journalism, media, fashion, etc. where in fact interns can often just get stuck in with real work and contribute pretty quickly, not like highly technical jobs in engineering or something) - and often they are full time roles for several months, highly competitive to get and not very flexible. Some don't even pay transport costs.
I always get annoyed when I see my uni careers department forwarding on adverts like these, yes there are some bursaries available from the uni to help with basic living costs but it still is nothing compared to the earning from a shop/ bar job you could otherwise get living at home.
Regarding the whole volunteering vs interning debate, I think that if a company is for-profit, you're an intern, but not-for-profits and charities should have permission to take on unpaid volunteers (who are doing the job out of commitment to a cause, rather than seeking experience as such). That being said, I would expect even unpaid volunteers to be given a small amount towards essentials like transport costs - bus and train fares are going through the roof...
This all being said, for short-term work experience placements (say, two weeks or shorter - where the student is mostly job shadowing etc. rather than really contributing) then I can understand a company not really needing to pay.
The whole thing about unpaid internships now being required to get any experience for even "entry-level" job applications is being fuelled by the wide availability of such unpaid internships. If no-one was allowed to offer unpaid internships, then no job applicants would have much experience when applying to entry-level jobs/ paid internships, so there isn't an issue with you not having enough experience as everyone is on a level playing field. Internships and entry-level jobs should have NO previous experience required, instead looking for your interest in the industry/ relevant skills to be demonstrated through things like uni societies, short work experience/ shadowing placements, insight days, etc.