1. Most ISPs don't allow residential customers to run an email service of their own.
Wrong. Sometimes, you may have to ask to have the port opened, but most allow it.
many domains will reject any email out-of-hand that's sent from just some random IP address
Set it up correctly. Set up the various SPF records and other such stuff. That'll greatly reduce the impact of this.
Furthermore, you *can* get your own static IPv4 IP that isn't in those blocks, and/or you can use a virtual server and forward that stuff, and/or you can use IPv6 to route around it, and/or you can use a different outbound SMTP server or forward through one. There are lots of ways around this trivial issue.
Why even bother with this when there's something like Proton Mail out there
Using a common service/server is one of the primary things this product is trying to avoid, as is using hardware/storage someone else owns (virtual servers / hosting / cloud / etc). There's nothing wrong with that part of the theory.
If you don't want to use a service like Proton Mail, what's wrong with using your own end-to-end encryption?
It relies on accessible and verifiable public keys and integration with the client software. That works within protonmail because all users get keys and can share public keys (AFAICT). Doing it yourself means pgp/gpg or s/mime, and both parties must have that, and there's no encryption of email headers (including TO, FROM, and SUBJECT) with those, so they won't be protected once they leave your server.
If you're really so worried about someone hacking into your communications over the Internet, then why are you even bothering with email in the first place?
What type of argument is that? Probably shouldn't use http either, nor facebook, nor any instant messenger, nor any search engine, nor the internet... heck, you should probably completely disconnect from every external line and seal yourself in a faraday cage within a bunker underground.
Email has loads of benefits and still the most widely used (head count) communication platform. It's certainly capable of sending an encrypted payload and the delivery mechanism is very well established... why not use it?
None of this means this product is good or worthwhile, but a secure communication appliance *could* be done right.