The Daily Grind: Why is quashing MMO cheating so damn hard?
Massively OP Kickstarter donor Daveha is not amused with an MMO industry that seems content to let cheaters get away with their nefarious deeds.
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While the linked post is more of an open-ended question rather than an attempt to provide an answer, I still think it's an interesting topic to bring up.
Personally, I've always considered a problem of 'proof'. Basically, that someone on the dev side of things has to catch the person in the act. There are some ways you can catch people using specific programs, but a lot of work goes into hiding those, so in the end, you aren't going to come close to catching everyone cheating if you rely on automated detection.
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