The problem is that I can understand (though not support) the reaction of the police/CPS. Looking at the footage, in devils advocate mode, you can almost see a wry smile on the face of the driver when he agrees that he has threatened to kill him. Thus I can understand the reluctance to pursue the driver further.
Yes I entirely agree that any threat of being killed is unacceptable. Yes it should be stamped out. However, due to the fact it is fairly obvious from the footage that the driver has no real intention to follow up the threats (he accelerates away), I don't think it is the best footage to make a stand with.
I also did say above that I can understand why he is doing it, and that a stand has to be made. However, imagine this did go to court, and imagine that it got publicity. Now imagine how the general public would look at the footage. If I'm honest (putting on my joe public hat) I think most people would think that the cyclist was over-reacting, thus negating any positive impact. Yes, you and I know how unacceptable this behaviour is, but I doubt many non cyclists would.
Yes you are right, I probably have become inured to this type of abuse, but so has most of the public. We need a strong case to defend in the first instance and to work from there, IMO.
Having said all of the above, I admire Martin and what he is doing and wish him the best of luck with it.