Since you don’t know a priori whether a later court will find abandonment or dilution, you actually DO need to defend against anything arguably close. And in this case not only is there a famous mark at issue, but overlapping channels of commerce and products.
And dilution has nothing to do with likelihood of confusion. Those are two different issues and two different tests (dilution applying only to famous marks).
Armchair lawyers.
Sorry, I was mixing up genericization and dilution there. It's been a long time since I studied trademark law.
That said, confusion in the marketplace is closely tied to one of the two forms of dilution — tarnishment, specifically. You're right that the other form of dilution, where a mark loses its distinctiveness, is a lot blurrier. Either way, though "arguably close" needs to actually be close.
But abandonment? Really? I'm pretty sure that by definition, trademark abandonment requires actually discontinuing use of the mark. Did you mean genericization?