Yes Rancho does contribute to the reward distribution, but if they really lost their keys then their curation rewards are locked up forever. We want rewards to go where they are earned, but I have no idea what their votes are based on. If it's haejin in control he may just want to troll the community.
Abuse would be far worse if it wasn't for HW and others acting against it. From what I've seen there is a lot of crap out there, but most people just won't see it and may think everything is fine. At least we are not flooded with comment spam (yet) apart from a certain account. Blacklists may become an important tool. I see hive.blog can use them, but I have not totally figure it out.