If the airplane sinks soon after ditching, the new ELT won't help much unless it's a much more expensive self-ejecting and floating affair. In the story above, the airplane stayed afloat long enough for the ELT to get off at least one burst, which can happen as late as 50 seconds after it's activated.
ELTs are still a rather poor method of locating a wreck. The large majority of ELT signals are bogus, and the ELT doesn't work at all in about 50% of crashes. They get smashed to flinders on rocky mountainsides, they burn, they sink, they get their antennas shoved into the dirt when the airplane goes onto its back. The 406 might be a lot better than the 121.5, since the old ELTs aren't followed by satellites anymore, but an automatic SPOT-type reporter, making location reports every few seconds, might be better, especially if accompanied by a 406.
Dan