There's a fair bit to unpack here, and I'm not familiar enough either. However, I am not convinced there is a causal link between tuition fees and "education inflation". Firstly, "education inflation" has been going on for a long time. I had landlords in the late 90s who were academics researching this. Secondly, the influx of non-UK pay-students (c.f. pay drivers in F1) was a thing before tuition fees. When I was doing my Part II, the middle common room was full of American students doing a semester or three at "Axfurrd" for exorbitant fees. Not all of them would be, let's say, Ivy League standard students, but most of them were from rich families. For sure this has increased, but I wonder if that's just a symptom of funding shortfalls; i.e. the introduction of tuition fees and increased overseas students are both symptoms of the same thing.
As Pinno points out, tuition fees are not levied against Scottish students attending Scottish universities (but they are applied to English students). This hasn't suppressed the number of foreign students. In fact, the issue up there is now that it is much harder for local students to get a place in a Scottish university, because they are all trying to plug the funding gap - the SNP virtue signaled no tuition fees but have not increased state funding to compensate.
Fwiw I have not seen any cost benefit analysis of tuition fees, but I would question whether the suppression of economic consumer activity that results from generations of people with 10-20 years' of a 9% "graduate tax" might actually outweigh the benefit of trying to claw back those fees. That might be the reason many of our European cousins don't have tuition fees.
I agree that not every subject is susceptible to being turned into a university degree. However it is less clear whether this means we send too many people to university, and some of them should go and learn plumbing instead. Our university attendance rates aren't particularly high compared to other rich countries, and so the counter argument would be we should be getting more people to do degrees in subjects that should be studied at degree level AND seeking to increase vocational training.
