I agree with what you write. His bass is quite high for todays standards :)
In a bassists forum (bassic.ch) this topic is discussed too, most of the post say it is only a question of comfort.
I do prefer a higher hanging bass more, too, somehow I have a better control over the neck and since more than a dozen of years, no pain in the wrist.
It is quite sure that the "modern style of playing" (betweens the knees) is more an optical thing than a technical. I couldn't. Looking sexy on bass is almost impossible with the bass under the chin, but Deacon isn't natural born sexy, so he hangs the instrument high ;-)
And the Musicman is a quite heavy bass, which he uses for the TYMD video, as well as the Kramer DMZ on Play the Game, so those basses are more comfortable when hanging not too low.
Special thanks to Arif Mardin who arranged and produced some hot and spacey horns on "Staying Power" ;-)