From reading the quoted RAW above, it appears that while the rules say that a 20 is a hit regardless of the target's AC, they don't say that it's a hit regardless of, say, underwater extreme distance difficulty modifier. If you've got a -40 modifier then won't you fail, regardless of the target's AC? I do think that the intent is for 20s to auto-hit, but I'm just playing a little devil's advocate here.
Also, I hate to use a slippery-slope argument, but it's absurd to think that a player can attempt any crazy impossible feat (s)he wants and expect to succeed 0.25% of the time.
IMHO, sometimes a DM needs to say "no, that's impossible and you don't even get to roll it."