Don't worry, CM, the airlines are going to have a whip round (or rather pass the cost onto the passenger via a ticket surcharge) and pay for you to have a nice new Mode A transponder with ten numbers in it! Mode W they will call it, yeah right....
I think it's reasonable to say that a fair part of the GA community will spend money on kit if they think they are getting a benefit. If I was flying under London TMA (or anywhere in the wildest parts of the UK for that matter) I'd consider something that increased my safety by reducing the chance of a mid-air a major benefit. I tend to agree that 'see and avoid' doesn't really work outside the traffic pattern and the best way to improve safety is to get a radar service. Unfortunately ATC in the SE of England are under-resourced and have their work cut out working scheduled air services. So the GA plane cannot get a decent radar service most of the time. The only time I really use a transponder for my own benefit is when I'm receiving a radar service, and if it isn't available there really honestly isn't any point in me paying for a decent transponder.
So back into cloud cuckoo land. If the airlines were so worried about GA traffic (and I don't see any evidence of this), and they are also worried about creaking ATC services (I think there is evidence of this) why don't they just pay to hire a bunch more of those very well trained controllers? As well as working the heavy iron, these extra controllers will also be able to provide a decent radar service to GA traffic in the choke points around London. Now as a GA pilot, if I thought I had a very high chance of getting radar service in busy airspace I'd pay for my own transponder. If everybody else thought the same way then the chances of two GA planes colliding would be reduced significantly.
One can dream!