I think banning IDB entirely is a longshot and, as others have pointed out in cases like a broken seat, may have unintended consequences.

But the penalties for IDB (payments to passengers) should be stiff. High minimums are more important than an uncapped maximum. $1000 for a short-delay minimum and $3000/day for overnight delays should be both a reasonable offset for (most) passengers as well as a deterrent against egregious misbehavior on the part of GAs such as what we saw the other night.

VDB should be uncapped. High IDB minimums will function as a natural cap...people will realize that short-delay VDB offers aren't going above $1000 cash or, say, $2000 in funny money. (Using my example minimums above.) A planeload of pax colluding together to ask for a million dollars each could not happen.

The only regulation I'd impose on VDB is that if an airline offers vouchers/gift cards, they truly spend like regular flight credit on the airline. The restrictions/trickery on airline vouchers has gotten out of hand, and this is NEVER explained by a GA during the VDB solicitation process. GA's always make the vouchers sound like unrestricted credit towards future flights.