The current differential should be challenged in court and have it declared unlawful.
I don't see a problem with safeguarded and non-safeguarded differential but I'm all for the idea of having free travel on all TOCs for all employees. I suppose bonus for long serviced staff could be free 1st travel, rather than that offered only to the management.
However a thing which should be challenged in court in my opinion is literal differential in pay for the same job done purely based on the "old contract" and "new contract" which is in place in every industry, starting from TOCs, through airlines/airports to the cleaning companies. Here, again, I wouldn't suggest slashing old wages down (as was effect of COVID changes put in place across Heathrow companies and airline industry) but rather topping up lower wages to meet the higher ones, obviously.
Coming back to travel privileges, I also think that they should be given to Network Rail and FOCs staff as well.
And when you get privileges for your partner/spouse, they can't use it for work travel. I think that should change as well.
Many times I travelled with a friend with no ATOC, we booked some holidays just a month in advance and his Advance ticket was cheaper than my ATOC fare for that journey. Yes, I understand I've got a privilege of changing my mind, or just walking up to the station and buying ticket at quarter of the price of the public doing same thing, but it just isn't as much of a bargain anymore when you plan something ahead.