First of all, the letter was never meant to be public. It was leaked by someone. Second, I understood the letter a bit differently.
I thought this part:
“Is this Torah and these are its scholars? Woe is to he who learned Torah, woe is to his father who taught him Torah, woe is to his rebbe who taught him Torah. See how crooked are his actions and how ugly are his ways.”
referred to the people who assaulted Rav Stav at the wedding. Yes, woe to the teacher, because when a Rebbe hears that his talmud, who he tried to guide in the proper derech, did such a thing, he should be mourning these actions! Yes, they trembled to hear the words of Chacham Ovadia shlita. But the 2nd half was about the people who went completely against halachah and assaulted a great Rav. Chacham Ovadia never would have approved such an action! Woe to the Rebbe who hears of his talmidim doing such a thing!