Do others agree with me that this is a blatant rip off
No it is not a rip off, it is just moving a hidden revenue stream by charging airlines less in passenger fees, who then charge less for the airline ticket.
What you are actually complaining about is that the fee is not hidden and is in your face. If the fee was just added to the ticket price everyone would be happy but the fee would still have been paid.
Also as already pointed out, drivers will sit in a drop off zone indefinitely while waiting to pick up passengers if they can. Luton used to have a real problem where all the kerbsides were occupied by long stayers. That problem no longer happens.