I think the pin is a red herring. I essentially never use it if given the option.
The claim here is compromised machines, the pins would be taken too.
All the pin does is push the liability onto me. By leaving the liability on the processors/issuers, I essentially have insurance (I pay my small part of the total cost of fraud in fees), if it were to switch to an I'm on the hook type situation, I could easily be on the hook for a large, unexpected, few.
I would think merchant liability holds a similar risk too, at least for small merchants, but also, the incentive to not have fraud for them should reduce the overall cost of fraud. As long as no merchants pull out of using credit cards at all, it's a win for pretty much everyone.