but I still don't see why we are forgoing a liveness check in favour of
this.

I attach a patch which addresses both bugs.  Its solution for (a) is to
make the advice disposable, i.e. it removes itself from the process
filter after it has fulfilled its purpose of displaying the output
buffer.  A syntactically simpler implementation of this could use a
plain boolean switch instead of removing the advice, but IMO the latter
is semantically more sound (and possibly more performant in subsequent
invocations of the process filter, though this should be irrelevant).

WDYT?

P.S. Would patch(es) for aesthetic changes to the rest of shell-command
(such as removing redundant variables, inverting the condition of the
massive if-then-else to reduce indentation, etc.) be welcome?  If so,
where should I send them?

-- 
Basil