Players had a number of tools to deal with Malaki, including the lawmaking process and the power of the Demi-Pharaoh. Either of these could have banned Malaki from the game, but players were reluctant to do so because there was a chance that the rare goods he offered would somehow advance (shortcut) the technology tree. It was a genuine case of moral ambiguity. More details about the event itself are here:
http://web.archive.org/web/20081203221126/http://wiki.atitd.net/tale2/TheTraderMalaki
Though neither formal tool was used, community leaders created enough social pressure on would-be defectors to run Malaki out of town, thereby "winning" the scenario.
ATITD explored all sorts of socially difficult puzzles, including the acquisition of power ("The Test of the Demi-Pharaoh,") online trust ("The Test of Marriage,") Monopolies ("The Test of the Funerary Temple"), the tragedy of the commons (mushroom ecology) and addiction (Speed of the Serpent.)
A Tale in the Desert, now in it's 6th telling, still runs, though most of my attention these days is on Dragon's Tale.
That is some special shit right there.
Teppy, I love to see someone dedicated to their game. Clearly Dragons Tale is your love and I think that's fantastic.
keep weaving the web. Your flock loves it.