Between having the code being open sourced, having your reputation on the line, having an incentive not to rip people off in hopes of continually making money on your "reporting" posts and so on, there admins of such websites have very little incentive to design the system in a way that will harm the project

Except when the haul is worth more than the reputation. The one saving grace is that SP cannot be immediately cashed out by a reputable user turned bad, but have seen many with incentive to retain good reputations turn to thievery in the poker world.

There are other problems with blockchain poker sites, such as immutability. Suppose two players collude to cheat others out of money, the cheated funds can never be recovered even if they are caught. And are they still allowed in the games afterwards due to no moderation? One of the cases where having a centralized poker site is better. But lower transaction fees probably make up for the downsides.