The law says that they can't circumvent, but you are well within your rights to sign a contract stating that the ISP is allowed to circumvent or that the ISP shares copyright with you. I'm pretty sure that such a contract would not necessarily be illegal unless a judge decided that it was too one-sided towards the ISP.
Contracts cannot superceed laws.
Yes they can.
this is them actively circumventing protection that you set up, not them failing to provide protection