I see only one semi-important point in there.
4. If he leaves there will be a chain reaction and others will leave as well.
I'm no doomsday prophet for the server like Rigby and Hanzo, but the more people we force to leave, the more people will follow.
Our playerbase and their reaction should be taken into consideration.
Also, I thought he was only punished for the nodus-duping before, what else has he done?
Currently, the ideal punishment I can see is equal to Warmonger's but worse. Force him to finish Hoenn, without WorldEdit. I've seen how heavily he relies on it in console (good Arceus the spam) taking it away from him will piss him off, and his decision to stay will be his own.