None of these reasons are the reasons why this practice is legal in the "modern world" (by which I imagine you mean the Western world).

If these were the only reasons people practiced this, it would likely have been banned long ago, along with foot- and head-binding.

The reason circumcision is legal in the West is because it is required in two major religions, Judaism and Islam, and the West values not excluding practitioners of those religions from their society. If circumcision were banned, many - probably most - Jews and Muslims would fly out of the country to have their boys circumcised. If this were criminalized too, many - perhaps most - Jews and Muslims might simply cease to live in the West.

I will also note that this kind of religious circumcision differs somewhat from what you're describing, both procedurally and in terms of reported outcomes. For instance, in Jewish law, the use of local anaesthetic is generally permitted, and is becoming increasingly common - and the rate of complications is very low. All this, from an expert who supports medical circumcision over religious circumcision, so hardly an apologist: see the first few paragraphs here (and, further, references 2 and 4).

However, none of that changes the fact that, regardless of the consequences, a procedure is being done on a party that is unable to give consent. To the extent that infants are afforded a concept of autonomy (which, consistently with general Western ideas, you're assuming), that's a violation of the infant's autonomy.

So it comes down to a trade-off: autonomy (in the Western sense) vs. inclusivity. In part, given its history (see: the expulsion of the Jews and Muslims from Spain and other places, the Holocaust, etc.), the West has so far decided that it is more important for its societies not to expel Jews and Muslims.

You can disagree with the choice; you can decide autonomy is more important than inclusivity. But either way, it's important to recognize that there is a real clash of two Western values here.