Appreciate the replies to this. I don't have an opinion about how the restrictions here compare to other airline policies. I think the heart of my frustration is probably the customer service and hidden restrictions. The breeziness with which the agent -- prior to my flight -- said "we'll take care of you, just get the hospital letter". I was given the strong impression that BA would offer genuine flexibility after the medical hold, and I was not in the position to do detailed research at that moment. Instead, what I found at the other side was an impenetrable thicket of policies, the net of which might have been a reasonable outcome for a UK based flyer, but certainly not for a foreign family who does not often fly together.

Carlusa, I'm sorry to hear you faced the same situation. It does make me feel slightly less crazy to know that there is another out there who feels similarly misled by the sunny initial presentation of the medical hold.