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They've just lazily cut and pasted a contract from the internet without reading it. They're never going to enforce it, and they're not trying to scam or exploit you.
I wouldn't waste time pointing out the contract's shortcomings to the customer or 'warning' other translators. Just humour them, and sign it.
Seconded. Be pragmatic.
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If the above was meant for me - well, TBH I don't see anything "pragmatic" in sacrificing one's fundamental rights as a freelancer and signing something that can pose a problem later on! Plus it's already too late anyway, as I told that company in clear terms what I think already a while ago, and that I simply cannot sign such a contract. (And my question here wasn't actually whether or not to work for this company - that was already decided - but how to warn others of such a company...)
Thomas T. Frost
Christine Andersen
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