I am a bit surprised that this issue is being cast mostly in terms of absolute altitudes that apply everywhere. The existing national airspace system is certainly not set up that way; the altitudes vary dramatically depending on location (as all full-scale pilots must learn as part of their licensing). Amazon may want to have its own slice of airspace over densely populated urban areas with nearby distribution centers, but they have no conceivable use for the airspace anywhere else. Likewise, it makes some sense to cap the altitude for model aviation at 400-500 feet within a few miles of airports, due the higher density of climbing or descending full-scale traffic. There's no reason to implement such a restriction in most other areas though (with the exception of military training airspace, etc.). If you can see your model you can certainly see and avoid the occasional full-scale airplane that might pass by.
Here's hoping that AMA is carefully explaining this to those on the Hill, who apparently are having a knee-jerk reaction to public perception of a hazard?