I don't think the core point does stand.
1. To deanonymise a hidden service connection you need to observe the traffic of all of the nodes in the circuit.
2. OK, let's say your adversary controls all of the nodes in the circuit and deanonymises the endpoints. Now what? You're no worse off than you would be if you weren't using Tor in the first place, so it's not an argument against Tor at all. All it's saying is "the absolute worst case of using Tor is no worse than the best case of not using Tor".