Having read the full wording the guarantee seems to have been carefully costed.
The only cash refund to PAX is when a pre-paid in-flight ammentity lie extra leg room is not delivered, and then the refund is only the amount paid. This is nothing generous.
Most compensation is in the form of $A50 or $NZ50 vouchers. These are designed such that J* will not suffer financially and in some situations will come out ahead. Vouchers cost less to deliver than cash handouts.
The voucher must be redeemed within 3 months for travle within 12 months. Hence many will expiry unused and those which are used will often be on standard fare travel as customers can't wait for a big sale.
At $50 the voucher effectively acts as a discount on a regular return ticket. Hence, J* will still get revenue in most cases when it is used. In many cases the revenue will be comparable to their sale prices.
This voucher effect also increases the chance the PAX will fly J* and not the competition next time they fly, hence J* gets some revenue when after annoying the PAX they may have got none. This also gives J* a chance to redeem themselves.
I agree this scheme could end out being hard for customer facing staff as PAX will ask for vouchers when facing the smallest delay etc.