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This seems like a fairly straightforward extension to BFD that adds the ability to make loopback packet larger in order to check bidirectional forwarding MTU. I have no particular transport concerns with this extension in isolation.

I'm not sure about the statement in the security considerations section that "[t]his document does not change the underlying security considerations of the BFD protocol or its encapsulations." Yes, it's not the 90s anymore, but AIUI the concept does involve changing packet sizes across potentially multiple encapsulation layers where there might be lurking assumptions about packet lengths and buffer size, and buffer size misalignments are still an easy place to find vulnerabilities. Would a statement to the effect that implementors of this specification should take care with packet sizes being dynamic where prior to this extension they were not be warranted in the security considerations section?