As a fairly regular sleeper user I've been delayed many times, a few times there have been doubts as to whether the sleeper would run / complete its journey, but Wednesday was the first short notice cancellation. It didn't matter too much to me as rather than work this was a trip for walking which I can rearrange.
Regarding alternatives, I would never use a coach (travel sickness) or fly (environmental grounds). I would want the following options.
1. Cancel journey, full refund for both directions - which is offered now. OK if cancelling trip but not if coming home from Scotland.
2. Catch evening (day) train if there's time, with CS to cover cost.
3. Overnight stay in hotel or static sleeper train with option to use day train or sleeper (if capacity) next day. CS cover cost.
I know that in providing a coach they are probably meeting conditions of carriage and this should be offered for those who want it (maybe only option other than refund for those in seats) but for a premium product they should offer more than an overnight coach.