Łukasz, about removing this block: it is the task I've spent almost all the time related to this issue.
But, unfortunately, it doesn't seem to be possible (at least in a simple way).
Several modules (see e.g. content/history, content/edit etc.) are using the same approach as extensions (hide_left_menu) BUT are drawing there OWN left menu.
So, as long as I was trying to remove this separator it was messing up those modules inevitably.