I agree that Fr. Damascene's characterization of "Taoism" doesn't have much relevance to Taoism as it actually exists. The division between "philosophical Taoism" and "religious Taoism," for example, is a myth cooked up by modern Confucians and Protestant sinologists in the West. And I think Fr. Damascene would admit that his work isn't really suitable in this light.
That said, his work is valuable (IMO) for taking a fresh look at Laozi that demonstrates how, like in all great philosophy, the message of Christ is hinted at in the Daodejing. I think it's a wonderful exercise in the Patristic practice of complementing Christian learning with pagan learning.