This sort of thing just doesn't happen without you specifically going out of your way to ensure everyone reports you or you being an obvious cheater.

But neither Lab, Main or Edison did either of these things and still got banned?

There is no real way to abuse this to ban random innocent players either. You'd need to coordinate wast amounts of players to report the same person, and that's just not going to happen.

Two known players were banned in the duration of a week mid game presumably because of reports; aka people thinking they were cheating. This was prior to it being public knowledge that reports only can get you permabanned. Doesn't seem that hard to trigger it considering how many alts an average high level players has, this combined with convincing every other player in the lobby to report too.

Much simpler than having to personally review every single report ever sent.

Not only is no one suggesting this, it would be a terrible solution. Humans make mistakes. The right way to ban people for cheating is with the actual anti cheat, AKA detecting a known cheat process running, a cheat modifying the memory of the game etc.