Simply blocking steam in your local firewall was enough with the old system, if the last thing the account saw was the library being open to play on or being the owner of the game.
There are a lot of weird, convoluted tricks you could do with the old system to get around most of the issues. For example: I've recently managed to play Outlast: Trials with my brother despite only one of us owning it by turning on the firewall between sending the invite and accepting it and then accepting the invite and launching the game before the invite receiving account (who has to be the owner of the game) sees the invite sending account as offline.
We've discovered this firewall trick relatively soon after Valve fixed the offline mode "exploit", but we never shared it publically so it wouldn't get fixed too. I have seen a few people talk about it over the years though.
I think people are more negative than positive about this change. The old system allowed for far more freedom at the cost of being more annoying to set up.
This change cracks down on anyone who used the old system in unintended ways, i.e. to share games with family members not living in the same household. For now that check only compares store region/country, but I wouldn't be surprised if they tighten the requirements further in the future.
It's also a negative compared to the old system if one of your (adult) family members throws a huge tantrum, allowing them to cause a lot more damage and inconvenience than before.
Edit: I just wanna mention, I am saying this as someone who is usually "RiDiNg sTeAm’S DiCK".