The residency restriction isn't anything new. Librarian around the country have told me this was always in effect. Probably not enforced to the publisher's satisfaction. Singapore's Library is an example.
The publisher may not be Macmillan or Simon & Schuster since the email says the effect is not retroactive. Although, these new terms may attract them to participate in Overdrive lending.
Depends on what the limited borrowing number is to be. If it's 100, not so bad.