Clearly, the idea of "reading" speed limits and varying your speed based upon some detected speed limit is a bad idea, at least with current technology. Signage-based solutions are easily disturbed by tampering with signs, and GPS-driven, database-linked solutions are subject to errors in the databases.
However, the idea of capping the maximum possible speed is sound, and here's why. With the exception of a few places which stubbornly hold onto their lack of permanent speed limits -- essentially some roads in Germany and the Isle of Man, to my knowledge -- it is fairly trivial to ascertain the maximum legal speed for a road-licensed vehicle within Europe. (Yes, the speed will vary by country, but there will be a speed limit beyond which *no* European country will allow you.)
That limit should be hardwired into your vehicle, because legally, you have no reason *ever* to exceed it. If you have an emergency, you contact emergency services (police, ambulance, whatever) who are legally allowed to exceed that limit. If you don't have an emergency, you abide by the limit. And if the technical challenges of a vehicle-enforced speed limit on every road can be solved, it would be a good idea there, too.
And here's why it is a good idea. If everybody -- including the politicians and those tasked with enforcing (and making money out of) the speed limits are forced to abide by them too wherever possible, then we can be sure that irrationally slow speed limits will be raised to rational levels. In the current system used by many countries, we have two rules. One for the general populace, designed to raise funding via a system of road taxation based on illogically-slow speed limits, and one for those who create and enforce the system, and are allowed to ignore the speed limit with a nudge and a wink.
If their cars cannot ignore the speed limit, they suddenly have a vested interest in setting proper speed limits. Right now, they have the very opposite in many countries.