(1) Oh Oh, lost the airspeeds! >>> Based on a single speed (the median)?
As soon as the system cannot figure out which one of the speeds, if any, is "telling the truth."
(2) Wait, we are in cruise, instructions say do nothing and warn the crew that they may have to take over. >>> Do you mean what the system currently does - maintain current pitch and power and sound 'cavalry charge' - or keep A/P and A/THR engaged, so that A/THR will increase power to Max CLB?
Keep A/P and A/THR engaged so that A/THR will be able to set the lookup table power.
(3) Power table lookup says cruise power for current flight environment is X, set power to X, maintain Normal law. >>> Maintain Normal law means maintaining protection for high AoA and overspeed. Both will not function when IAS drops to low value. High AoA thresholds at low IAS are too high for protection at cruise Mach. There will be no stall warning.
Maintain Normal law means just that. Plug in last valid airspeed and Mach number. Live and die by that. This is a dead reckoning exercise. How long you feel you can safely fly while dead reckoning the airspeed determines the period before you dump control to the pilots. This is likely the key certification issue. 3 seconds sure, no big deal. 20 seconds yeah, why not. 60 seconds, I'm beginning to get uncomfortable. How did we fly in the old days before autothrottles anyway? I can tell you I was not jockeying the throttles in cruise.
(4) Monitor airspeeds to see if we can get a valid airspeed. Airspeeds agree on 90 knots? Not in the acceptable range-disregard. Airspeeds now say 271 knots. In acceptable range. Advise crew that we are resuming normal control. >>> What is the 'acceptable range' ?
To be determined by test flights or using existing criterion if deemed acceptable.
(5) End of allowable dead reckoning period (where control would then pass to the crew). >>> What happens here? Isn't the crew always in control within the flight envelope?
This is where you play the cavalry charge if no valid airspeed is found. A/P and A/THR drop.