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[Playstation Lifestyle] Steam Now Admits Players Rent Digital Licenses, Not Buy Games
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I think you know the answer: your copy goes poof. It's up to you to decide if the convenience is worth it.
Steam's TOS does cover you a bit on the first part; an unlisted game must still be available for previous purchasers, but the publisher or developer is not obligated to keep it functioning. They aren't allowed to intentionally sabotage the files on the depot though; steam can and has rolled back changes when a developer tries this.
I'm actually fine with this distinction; most games I buy are Indies anyway, and most can easily be backed up outside of Steam. On top of that, nothing lasts forever, even software. Hardware platforms change, dependencies shift, and over time things break.
We should try to preserve games, and not accept them artificially breaking, but we shouldn't expect things to last forever, for free, either.
Likewise, no online platform lives forever. I quite like Steam, I think it's been a positive force for players and developers, and I think it will be around for quite some time. Someday, eventually, it will go away. But you have to trust someone, at some point.
If that is a problem for you, buy from a place that gives you more control, like GOG.