I agree that the current User Interface is not great, and I probably deserve at least some of the blame for the way it is now, so I think it is really great that you are trying to make it better. Thank you very much.

And, I don't really want to comment in detail on your proposal (though from a quick look, there is lots to like about it). I just want to make sure you are aware of one important requirement (well, important for the Open University) that it would be good if you did not break.

1. At the OU, we have a custom message plugin, which sends messages through the University's custom messaging system. This ultimately sends an email to the student, but it also puts a copy of the message on the student's portal page, and support staff can check that. The point is to eliminate the excuse 'you never told me that' from students. We can prove that we sent them a message, and they had a chance to see it.
2. So, for 'important' messages, we want to ensure that they are sent through that plugin, and that they can't be turned off. But we also don't want students to be able to select that plugin for any other messages.
   

That is why, in addition to the individual user's perference page, where they can set their persona preferences, there is also an admin settings page at Admin -> Messaging -> Notification settings.

(Yes, this UI also sucks, in part because it has to match the UI of the user preferences page, but at least only admins suffer because of this one.)

So, anyway, whatever solution you finally come up with, please consider this requirement. I think that becuase the two pages are related, it is natural to consider them together.