Same here, I was confused this afternoon when my home vpn hosted on a servebeer.com subdomain wouldn't connect. Now it makes a lot more sense, but I'm left with a very bad taste in my mouth.
I'd like to see that on a global TLD. If you mean that any arbitrary country can seize a TLD belonging to that country, then yeah I guess you are right. You can always get a distributed TLD but then you have the problem of them not being resolvable unless the PC you are at is correctly configured.