First off, I strongly disagree with "the problem with prohibiting gameplay assistance is that it skews the incentives too much in favour of skilled players and pushes casual players (and investors) out." As my prior statement makes clear, I feel that bots and battle helpers significantly erode the role of skill. Normal ranked is one thing but when it comes to ranked leaderboard, tournaments, and brawls it is supposed to be about competition and skill. Removing the skill factor defeats the purpose of having competition. Imagine people complaining that they can't win Olympic medals because "their lifestyle doesn't allow them to invest hundreds of hours into training and practice." Complaining they can't win world chess tournaments because "their lifestyle doesn't allow them to invest hundreds of hours into gameplay strategy." Complaining they can't ace standardized tests, school exams, or professional exams because "their lifestyle doesn't allow them to invest hundreds of hours into studying and memorization." In a competition, if you don't have the innate skill or the time to build up your skill, then no you shouldn't be winning the top prizes. And no, I don't think the human-only modern ranked change has significantly allowed a competitive player to definitely earn more than a casual one if the casual one is using a battle helper all the time.
I disagree with your logic on both "Enforcement is not feasible" and "Public vs Private." Using your line of thinking, the Olympics and any world sports organizations should never have any rules against performance enhancing substances or any other advantages (sharkskin suits, blade runner prosthetics, high altitude training) because the Russians (or other groups) are going to find a way to cheat anyway. When you have the entire Russian government backing cheating efforts (like we saw with doping in Sochi), it's going to be largely undetectable and even if it is detected it will largely be unenforceable (and any such punishment is just a slap on the wrist). So a rule against doping only hurts the people who follow the rules, doesn't do enough to catch those who are willing to break the rules, and just forces doping efforts to go underground to stay hidden.
Due to cognitive dissonance, most people are the hero of their own story and very few are willing to concede (publicly or to themselves) that they are anything but the protagonist. You claim that you care about reputation and a TOS addition would cause you to be "replaced by a private individual who doesn't care about reputation." Well, in Bubke's mind, he has always botted responsibly. (Which is ironic when most of the demand for Xbot tournament/brawl battle helpers was because people wanted to keep up specifically against Bubke's advantage). Even j6969 thought he was doing good, and kept trying to differentiate his botnet from other botfarms. Way too many people always say "everyone else is botting recklessly but I am botting in a responsible manner."
And as for your arguments in "Demand for gameplay assistance," of course there's demand for it because it's an easy shortcut that bypasses the need for skill or time. There will also always be demand for performance enhancing drugs and other forms of unfair assistance (butt plugs in a chess match?). These forms of additional assistance are "continuously getting used for a reason." Imagine for a moment if there was a chess "battle helper" that gave you strategic chess options, letting you choose between a Garry Kasparov strategy, a Magnus Carlsen strategy, a Bobby Fischer, and a Jose Raul Capablanca strategy (based on data from all the chess matches each of those legends played). Then chess players who don't have time or interest to learn strategy, could still have a decent performance because that's how they enjoy playing the game. In a competition, it's not about letting players play the game how they want. Competitions and tournaments have rules and standards for a reason. Otherwise, why prohibit athletes from using performance enhancing drugs if that's how they want to compete? Why should there be academic rules against plagiarism or AI assistance if that's how students want to learn?
RE: XBOT's stance on Battle helper (Proposal 8470)