I've been a vocal critic of beneficiary rewards in their current form for some time now, but not for any of the reasons you mentioned. You raise some good points, though. I think what will happen eventually is that apps will find a market balance against the convenience they provide. Honestly, I think the days of 25% beneficiary rewards are numbered. Something like 5% is much more sustainable, but even that may be too high in the long run.

One thing you didn't mention is how the rewards are distributed. I don't like beneficiary rewards in their current form because they go straight to SP. Unfortunately this causes less SBD to be printed, which in turn causes lower downward pressure on SBD, which contributes to the broken peg.

I am working on an app of my own. It's an internal struggle whether I want to use beneficiary rewards or some other mechanism. I know that I want it to be free, and I know that I don't want to force anyone to contribute. I believe that since it is something I'm doing in my free time and not my job, I do not strictly need compensation. Plus, it will be open source and free software, so hopefully I will have some support from Utopian as well.

So, if I do have beneficiary rewards, there will be a clearly advertised option to disable them. The question remains if I even want to be responsible for that damage to the peg. When SBD was higher, the answer was an absolute "no." These days, it's approaching a "maybe," but it's still a "no."

The good news is that @timcliff has recently submitted a pull request to fix this issue by paying out beneficiaries according to the author's selected payout mechanism. It seems, though, that it has been tagged for HF21. I don't know how far off that is, but seeing as we've been waiting for HF20 for a really long time, it saddens me to see it being delayed.