It seems a bit of a stretch to argue that the proposed reform will somehow narrow the scope of prohibited speech. If you can draw a distinction between speech which is offensive enough to "excite hostility" but is not offensive enough to "stir up hatred", then hats off to you. But I can't really see any distinction at all.
Thanks for outlining this issue with such clarity.
The modifications proposed are in response to the Mosque shootings, but, ironically, wouldn't there be a case to prosecute anyone who published some Islamic religious texts, I'm thinking specifically of what they say about homosexuals.
They would seem to contravene Section 131 of the Human Rights Act you outlined above, if those rights were extended to gay communities.
If someone publicly said that a particular New Zealander of Ruritanian descent should "go back to Ruritania", in a context where the plain meaning was that the Ruritanian–New Zealander was unwelcome here, could that be an offence, either under the current law, or the proposed changes?