>you're talking about Intel ME/AMD PSP?

I'm talking about the entire chip. You are unable to implement a new instruction for the CPU for example. Only Intel or AMD can do so. You already don't have full control over the CPU. You only have as much control as the documentation for the computer gives you. The idea of full control is not a real thing and it is not necessary for a computer to be useful or accomplish what you want.

>and your arbitrary guest will soon be pretty useless

If software doesn't want to support insecure guests, the option is between being unable to use it, or being able to use it in a secure guest. Your entire computer will become useless without the secure guest.

>Yeah you can boot your rooted AOSP, but good luck interacting with banks, government services (often required by law!!), etc.

This could be handled by also running another guest that was supported by those app developers that provide the required security requirements compared to your arbitrary one.

>That "abuse" is just rational behavior from misaligned incentives

Often these can't be fixed or would result in a poor user experience for everyone due to a few bad actors. If your answer is to just not build the app in the first place, that is not a satisfying answer. It's a net positive to be able to do things like watch movies for free on YouTube. It's beneficial for all parties. I don't think it is in anyone's best interest to not do such a thing because there isn't a proper market incentive in place stop people from ripping the movie.

>If there is a will, there is a way.

The goal of anticheat is to minimize customer frustration caused due to cheaters. It can still be successful even if it technically does not stop every possible cheat.

>general purpose computing

General purpose computing will always be possible. It just will no longer be the wild west anymore where there was no security and every program could mess with every other program. Within a program's own context it is able still do whatever it wants, you can implement a Turing machine (bar the infinite memory).

> Intel or AMD

They certainly aren't perfect, but they don't seem to be hell-bent on spying on or shoving crap into my face every waking hour for the time being.

> insecure guests

"Insecure" for the program against the user. It's such a dystopian idea that I don't know what to respond with.

> required security requirements

I don't believe any external party has the right to require me to use my own property in a certain way. This ends freedom as we know it. The most immediate consequences is we'd be subject to more ads with no way to opt out, but that would just be the beginning.

> stop people from ripping the movie

This is physically impossible anyway. There's always the analog hole, recording screens, etc, and I'm sure AI denoising will close the gap in quality.

> it technically does not stop every possible cheat

The bar gets lower by the day with locally deployable AI. We'd lose all this freedom for nothing at the end of the day. If you don't want cheating, the game needs to be played in a supervised context, just like how students take exams or sports competitions have referees.

And these are my concerns with your ideal "hypervisor" provided by a benevolent party. In this world we live in, the hypervisor is provided by the same people who don't want you to have any control whatsoever, and would probably inject ads/backdoors/telemetry into your "free" guest anyway. After all, they've gotten away with worse.