But I still feel that PAYG is a daft term for Oyster, since TfL want it
to be a replacement for cash fares which really are PAYG and don't have
a £3 initial charge.

Perhaps cash fares will be rebranded as "Pay through the nose" from January.

The £3 deposit can be recouped from two journeys from next year so its hardly
a moot point.

Cash - 2 x Zone 2 (£3) singles = £6

Oyster - 2 x Zone 2 (£1) prepay = £2 (+ £3 deposit) = £5

Not only recouped but a pound saved.