I just got the letter today, and my interpretation is if you get any MSN or Yahoo value added services or use a Verizon email address, you now access these services through a Fairpoint URL and Fairpoint email servers. You are no longer a Verizon DSL customer, you are now a Fairpoint DSL customer.
In other words, nothing has changed, you just type in a new URL from now on to access webmail and MSN/Yahoo Verizon^WFairpoint services, and you change the POP/SMTP settings in your email client.
At no point is Fairpoint blocking the real MSN and Yahoo websites nor blocking you from using MSN and Yahoo directly for your non-bundled-service services.
Slashdot jumped the gun.