You don't need thousands of dollars of hardware. You need one (1) Raspberry Pi 4, plus an HDMI capture card and a Raspberry Pi Zero to act as fake mouse/keyboard. You can totally do that for $50. (Probably less if you use an Arduino clone instead of a Raspberry Pi Zero.)
Heuristic software works against the most common cheats. Standard anti-piracy tricks work against the most common cheats. Kernel-level anticheat is only useful against a very specific kind of high-end cheat, and if you're going that far, you might as well use an undefeatable hardware cheat.
It boils down to a risk assessment. The fact is people interested in cheating continue to escalate the norm. That's the arms race.
Meanwhile we are letting shady companies illegally spy on users [0] and mine crypto [1], for what? What is the gain? What is the value proposition of kernel-level drivers in the anti-cheat application? What's more, the average gamer doesn't know anything about computers. How can they be expected to make an informed decision about whether or not they should buy a game with kernel-level anticheat if they don't know what that means? Even worse, there is no legal requirement that a game's marketing material say anything about its anti-cheat implementation. These aren't tin-foil hat concerns, these are the enablers of real scandals that have happened and are happening.
Let's not forget that a large need for anti-cheat comes from focus on centralized matchmaking overr community-hosted and community-moderated servers that were more common before the game industry's focus on monetizing their games to the last bit.
The people they do buy cheats from do the work and effort. They don't seem especially bothered by kernel-level anti cheat stuff. It keeps them in business, since they get less quick home-brewed competition.
The big issue is not the existence of cheating, but the scale of the problem. A software hack is infinitely scalable, a hardware setup is not.
Some cheat dev only needs to develop that "high-end software cheat" once and can sell it millions of times around the world, with super easy distribution over the internet. A setup with hardware video capture costs $50-$200 for every single user for hardware alone, and needs at least a bit of computer knowledge to set up.
Heuristic anti-cheat works about as well as heuristic anti-spam. It might actually catch more legit players than cheaters, due to the false positive paradox[1].
Heuristic software works against the most common cheats. Standard anti-piracy tricks work against the most common cheats. Kernel-level anticheat is only useful against a very specific kind of high-end cheat, and if you're going that far, you might as well use an undefeatable hardware cheat.