Terry, while I agree with your sentiment 100%, there are a few nit-picky things in your post that we should probably illuminate... Not necessarily incorrect info, but perhaps not fully disclosed.
AI ABS-BASED P/W RATIOS: The S197-specific call-out and subsequent 0.5 power factor is based NOT on the OEM ABS system, but on the FR500S system. Since the FR500S system is "impossible" to differentiate visually from the stock GT system (label on the module "fell off" or was rendered illegible), that system is specifically penalized. The rule is that "OEM" ABS systems are legal, and the FR500S IS technically an OEM system, therefore... Yes, it was programmed with sticky race rubber, race pad compounds, and just about the exact optimum weight in mind, and demonstrates a CLEAR advantage (as you outlined), so rather than try to ban a part that is "unable" to be inspected, the assumption is that ALL S197 ABS systems are the race system, thus the penalty. In AI, where car construction costs CAN push $100K, the two thousand (tops!) that it would take to convert to the FR500S system is a drop in the bucket.
Second, the photos: All of the cars pictured in your photos of on-track hooning are from the CMC class. Camaro-Mustang-Challenge (CMC) is the "little brother" in the AI family, and in that particular class, ABS is illegal. Period. Even pulling the fuse isn't enough for the CMC crew, either remove the pump, or completely disconnect the wiring harness to the ABS rig. The S197 has become the red-headed stepchild of the series. Major power hits, weight penalties, tire-width penalties, all to try to get it to perform as badly as a Fox/SN95/3rd Gen/4th Gen... In essense, they drove out the S197 from the series.
The point remains, though, that ABS is perfectly fine on a race track. Can you out-brake the ABS? Sure you can, if your name is Dean Martin, Max Angelelli, or Randy Pobst. Maybe.
Ha well that explains some of the carnage I saw going on in that particular corner at Hallett. On a couple laps, the CMC field was 6" here and 3" there from a demo derby.