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In certain heavy wind and sea-state conditions, the sail may become backwinded and overpower the vessel's ability to correct its course.
I think the reason offshore sailors use the end boom preventer is that they are often more at risk of jibing because normally don't have someone at the wheel / tiller at all times (relying instead on autopilots or self-steering wind vanes) and, more to the point, they are frequently dealing with larger seas which can increase the tendency for the boat to roll heavily when sailing down wind, thus increasing the risk of sticking the end of the boom in the water.
Coastal sailors don't have to deal with these circumstances quite so often and mid-boom preventers or boom brakes may be the preferable option. As I indicated in an earlier post, I used a mid-boom preventer for several years and it does make it much easier to release the preventer in a controlled manner when the mainsail goes aback.
Fortunately, I haven't yet experience the situation you describe -- with the sail aback, preventer holding the boom from jibing and the rudder unable to bring the boat back down wind -- but I can imagine it happening. As you suggest, the recovery would be challenging, but so far I've found that the combination of easing the preventer while recovering the slack in the mainsheet and helm action can usually get things back to where you want them. I think there's also a lot to be said for keeping the sail area appropriate to the conditions at hand and having a human being driving the boat (or at least sitting at the helm prepared to react) when the wind and sea state get up. After all, an attentive helmsman is probably the best "preventer" there is.