new european legislation and effect on big sites

there is something I don't understand about the legislation about online poker and how sites deal with it. For example, there is PokerStars.it for Italy: do the player there only play with other italian? So it means on the normal pokerstars you don't see italian people?

Now the french-speaking Winamax skin for Ongame is moving to winamax.fr and you have to close your account and reopen one at Winamax: does this mean you will only play with french?

And pokerstars apparently will also comply with France. Then Portugal? Then what?

Are we moving to an online poker world where all the rooms/skins will divide their players by country and where people will only play with people from their own country? What effect would this have?

In a way, it can be good no? Because chinese grinders and chinese-collusion-ring (seen the recent $104 DON bust?) would only be able to play with chinese cheaters

This sounds very similar to what they are trying to do in California here in the USA. They want to make it perfectly legal to play online as long as you play at a casino that was setup by the state. Any other play online in California would be considered a felony. In essence you would only be playing with other players in California if this went through as is.

This is strange. Why is that? Is this to prevent money from circulating too easily between states/countries?

I really wonder what the effect on the games it will have: I guess it's better to have something legal rather than nothing at all but the games may very well completely dry up.