If you're suggesting that somehow there is a difference from today, then you're accepting the notion that the Senate doesn't have legitimacy today. But they do have all the powers that go with that, and those same kinds of impasses can exist.
The strange situation right now is that the resolution of an impasse, as happened in 1988, is by the democratic body seeking a dissolution and going to the voters for a mandate to make it clear and put some kind of moral pressure on the appointed body. That is a bit alarming in a democracy, that an appointed body could effectively force, hamstring, or tie the hands of the duly elected body and create that kind of impasse.
If you move forward with Bill C-20, in a situation where most senators are the product of a consultation process, at least the impasse you have that creates that situation is one that has a democratic body on either side. The solution would still be the same--seeking a dissolution in the House--but at least it would be prompted by others with a legitimate basis for their mandate.