+1 for this. And for crushing. What's the point of just selling it again so someone else can do the same thing with it. No one would support the cops selling weapons that they'd confiscated from criminals, they want them gone so that they can't be used to commit more offences by someone else.
As to outstanding finance on cars that are being crushed, imagine if you had to prove a good driving history to the finance company before they'd accept you as a good "risk" to loan to? Perhaps people would drive more sensibly if they thought that certain offences would prevent them from ever getting a car loan...
It wouldn't take much confiscating / crushing etc to have an impact on anti-social behaviour in cars. You'd be out with mates and they'd encourage you to do a skid etc, it wouldn't be worth the risk in your nice car..
The one thing i would wish however is that cop cars were all fitted with video recording, and that offences that might lose you your car needed to be backed up with video evidence, not just their word against yours. No evidence, no impound, no proof of hooning.