Makes me wonder: if the amount of users affected is vanishingly small, then why implement it, as it sounds like a vanishingly small problem to me?
Banning the letter ö from names on hacker news would affect a vanishingly small amount of users. But if threads needed 100 times more processing and were much slower to load when a user with a ö posted, the problem itself is quite large.
Without knowing the full circumstances of why they're doing this, what problems it solves you can't really say if it's a good solution or not. We can however absolutely complain about the "no notice, no advice, no assistance" way it was implemented.