Most of your points had been answered by posts made before you even brought them up.
Basically, no, we are not going to let people slide with breaking rules for the sake of 'activity' in one area. If someone consistently breaks rules, has a record, and has shown no desire to change and actually follow the rules, then they are going to be banned. Period. If people want to break rules, they have to deal with the consequences.
Now, my suggestion would be to drop it, as Ush said to do so more than once now. Drop it.