I am so conflicted in this issue! I agree the track looks a great asset and that any attempt to actively rehabilitate it (rather than just letting it slowly grass over which would make it much less visible but still useable) will probably just make things worse. But I find it hard to defend the track without feeling like I'm also defending the complete lapse in process. The worst thing is whatever way it goes it's either the landowners or iwi that will end up being or feeling punished here, when actually it seems to be all down to council ineptness!
Yeah, it was all pretty poorly managed and difficult to see what the solution is - as you suggest, whatever happens plenty of people are going to end up unhappy.
I'd obviously like to see the track stay though. Coming from the UK, poor access to the countryside is one of the very worst things about NZ.