How is that an existential threat? No massive waves of nukes were fired out of their silos, no bombers entering Soviet airspace, no invasion crossed the borders. Impending threats yes, but not like they had their territory violated.

(EDIT: Misread it. Regardless, the USSR perceived an existential threat by NATO, and responded by threatening existential defeat for NATO by readying their nuclear weapons for launch. They didn't want to actually fire them until they have confirmation of nuclear war, and this is behaving in a manner consistent with MAD.)

Even if the USSR interpreted the malfunctioning early warning systems as an actual nuclear attack, and thus existential defeat is imminent, and behaved in your scenario by Kessler Syndroming GEO as a "symbol of their willingness to go nuclear" (pretend for a moment that Kessler Syndroming GEO is actually viable in the 80s), only find out that this was due to technical glitches and aggressive drills, what they would have done was escalate the scenario by destroying NATO assets, increasing the likelihood of leading to an actual nuclear war, which will be the lose condition for everyone.

What the USSR did in reality in response to believing that NATO was escalating to a first strike nuclear launch was more in line with the usual MAD response. They readied their nuclear arsenal (knowing that NATO would realize what they are doing), and prepared to fire back in the event of a nuclear strike.

Again, no one wants to activate MAD. It's purpose is that once a nation acknowledges existential defeat, it has the option to bring everyone else to hell with it in the hope that the threat of doing so is enough to avoid existential defeat in the first place.