I believe I was doing a bit wrong earlier; it's fixed now (
https://github.com/kaushalmodi/.emacs.d/commit/822854333cd2cc05c2b4cfe642925f832cf40cfb
 ).

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(defun modi/region-extract-function--C-u-kill (orig delete)
  "When a region is selected,
and if \\[universal-argument] is used,
and DELETE is \\='delete (when doing \\[kill-region]), or
    DELETE is nil (when doing \\[kill-ring-save]),
kill the region with all trailing whitespace removed and also replace 2
or more spaces with single spaces.
Else, execute ORIG function."
  (if (and (region-beginning)
           (eq 4 (prefix-numeric-value current-prefix-arg)) ; when using
C-u, and
           (or (eq delete 'delete) ; when cutting (C-w), or
               (eq delete nil))) ; when copying (M-w)
      (let ((sel (filter-buffer-substring (region-beginning) (region-end)
delete)))
        (with-temp-buffer
          (insert sel)
          (delete-trailing-whitespace)
          (goto-char (point-min))
          (while (re-search-forward "\\s-\\{2,\\}" nil :noerror)
            (replace-match " "))
          (buffer-string)))
    (funcall orig delete)))
(add-function :around region-extract-function
#'modi/region-extract-function--C-u-kill)

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So now it is probably more immune to future changes to the default value of
region-extract-function. Thanks for the tip to look into add-function.