Wall of text incomming, prepare yourself.
Going to try and be impartial as possible but as you may expect I fall quite strongly on the Anti-SDC side. Not what they just how they do it.
Yes you can be a complete "expletive" in-game but many of the arguments don't add up 100% for me or appear thinly veiled to protect their interests:
1) This is the problem that has arisen from making Elite a mixture of genres (MMO/Arcade/Nostalgia etc). SDC say they are former Eve players and have taken that mentality, they say it's a game and it's part of it. Very true but this ain't Eve, want to play Eve then go play it, no one is stopping you... Try to play the original Elite and show me where it's part of it... oh wait it's not an MMO and Elite is not that Dangerous, oops, sorry guys.
Yes the ability to do those things have been added, but just because it's a possibility doesn't mean you have to do it.
I'm going to play Counterstrike and team-kill every player on my team at the start of the round because it's something you can do and is "part of it". I wonder how long that will last before I get blocked from the servers.
In any case if your objective is to have fun and blow stuff up why not join or create a PvP league guaranteeing lots of fighting everytime you log-in? Lets be honest with each other, you enjoy the salt and the controversy, the killing things and blowing people up is a footnote on your enjoyment register. I'd wager you spend more time chatting about how to cause a fuss than you do flying around killing people.
Oh wow, that got away from impartial fairly quickly, sorry I will try to reign that in a bit.
I don't disagree with the killing but there should really be an in-game reason. Hopefully the new crime and punishment updates will see a capital ship or two chain interdicting the SDC CMDR's. Actually that would be an interesting gameplay addition, a capital ship that hunts the player with the highest Fed/Imperial bounty, and a wing of Elite Corvettes/Cutters/Anacondas hunting the highest independent/Alliance bounty...
2) Yes its a game and that's true but it affects real people in real life. I've had good days where I've played community goals, I've seen and been on the receiving end of that wizard CMDR's lasers and enjoyed the interaction but then I've also had days where all I want to do is enjoy the scenery or do a bit of PvE and a CMDR attacking me would have been rather negative for my real life psyche, not too terrible for me personally since I'm in a good position irl but some people are depressed or suffer from issues in Rl that they try to escape in-game.
Some people can't "git good", some of us are old, poorly co-ordinated, slow reflexes, disabled, too young, too little game-time. Just because SDC have some highly skilled people (let's not argue that, they are highly skilled despite often picking on the weak and unskilled) doesn't mean anyone can become as good at PvP as them. Some people achieve in months what others achieve in hours on Elite so they play in Mobius as they have a goal that they are progressing towards and don't want that goal ruined setting them back months of irl time.
3) The clowns bit. Um, excuse me, just read the article, if you act like clowns don't complain about being called it. I really have 0 sympathy for anyone who acts provocatively then complains about the results. Maybe if the PvP crowd organised more successful events and weren't as "expletives" in game they'd get taken more seriously and get more respect and attention from Frontier. I mean look at the community goals and events the PvE community have created by comparison, you can understand why FD are looking at them more.
4) Youtube Audio I can understand the arguement but lets be grown up, SDC know, we know, Frontier know. SDC are intelligent people, everything is there for a specific reason to provoke a specific response.
Using the Arabic for "God is Great" as a suicide/attack cry should be actionable by FD, it doesn't belong in any game except maybe counterstrike (see point 3 about going in a game to escape real life, some of us have experienced horrible things and it's not right), people have been investigated by the police for less than that. (I believe the UK term is "Inciting racial hatred").
5) Infiltrating private groups, attacking streamers and the AforA event. I'm against SDC on the attacking streamers since they located said streamer via their stream (against Twitch's EULA). Same with private groups, it's deliberate insolence because your "play it your way" isn't the same as everyone else's. Why is SDC's "Play it your way" more important, the arrogance/ego point seems to come back again.
I'm actually on SDC's side on the whole cancer thing but this comes with an asterix the size of a small mountain
*. I believe some people will take offence at anything and charity is charity. However, SDC need to check their presentation, or just accept that they are trying to get themselves banned by FD, I mean what would provoke more outrage and controversy right?
You don't go to a policeman and blow cigarette smoke in his face, it may be legal but you know you have only yourself to blame if poking a bear with a stick leads to a broken you. Lets get real again. It's like when a parent tells a child not to sit on the chair they are moving so the child stands on it and says "I'm not
sitting on the chair", it's simple impertinence and again SDC have to realise eventually Frontier may decide not to be a caring parent any more and ground them to their room...
* I disagree with targeting noobs since that's one of the things that made me quite Eve during the free trial, at least let me learn enough to not kill myself before you come along and do it, don't need your assistance dying just yet... Whilst I appreciate the gesture of providing cargo etc to the parties affected some just quit. Some we may never see again. I doubt I'd be here if I had been killed 30 times in the starter system by vastly superior ships and players.
6) Finally no the game won't die without you. You seriously cannot be that egotistical that you think a group of probably under 100 players (haven't checked) control the life of the game. It all depends on how it's handled, yes if they ban with no explanation or say for killing a CMDR then you are correct there may be a PvP exodus. However, Frontier could pick a specific occurrence and say this gets you banned. Provided they make it clear why then there will be no mass-exodus as lets be honest, you are bending the rules and pushing the limits, it's only expected that you eventually find out how far too far is.
For example if they say repeatedly using X's twitch stream to find and kill them is harassment, it's occurred X times in Y weeks which is significantly more than random chance therefore you are banned.
Also see the * on point 5, if you are discouraging other players and making people quit, how important are SDC really to the games survival? Yes they get some press attention but there's been plenty of other groups doing that (Hutton, DW, Fuel Rats etc etc etc).
Edit:
7) The modes question (see post above mine) it's a fair comment but if there were more PvP people there would perhaps be more action. Persuade people to do PvP, organise sidewinder contests, suggest community goals, make activities only available in Open and only available to those that do PvP and you may win over some of the Mobius and group players, at current all SDC are doing are proving them right and driving them further away from Open and PvP. Lets be honest given Frontiers statements there will be no forced-open in this game, so lets stop arguing that. There are suggestions for increased effectiveness for BGS/PP activities in Open which I support but again, lets be realistic on what could happen rather than just argue.
Also has anyone considered a counter infiltration? Join SDC, deliberately harass someone or use other things just to get banned so that young wizard has to quit (or has to eat his words)... Would be amusing if a terrible waste of time and money. <- Note I do not approve or condone such an action, I'm merely asking if SDC and others have considered making a statement like they have may lead to this eventuality
Finally my personal verdict:
Is it right to ban SDC? -> No.
As I said above I'm not anti-PvP, I've been on the reciving end of SDC. Open is Open, SDC should be there and do what they do, the same way CODE is there and other PvP groups.
But:
If I was Frontier I'd look at the stats and send a statement to the SDC leaders. Assuming the statistics are as expected (Deliberate targetting streamers via twitch streams, infiltrating private groups etc etc).
It should say "Continued use of X will get you shadow-banned", "Continued activities of Y will get you shadow-banned". Following a specific warning if you continue the ban is permenant, consider this a specific warning for targetting X streamer repeatedly (over X instances in X weeks isn't random occurance etc).
Make it very clear what is considered poor behaviour, they've partly done this in the open official response but it's not clear enough for my liking. There should be a hard line drawn saying "If you infiltrate flout Mobius' rules again we will investigate the accounts via IP addresses and monitor/block them for repeat offences". There's no middleground, no bending the rules and all sides know exactly where they stand. Yes this may require clarification on minor and obscure points but thats what the community team and support team are there for.
No one should be banned for a single occurance (we all make mistakes) but joining a PvE group for PvP, just say that out loud and it sounds silly and wrong, common sense should be applicable and an offence that can merit a warning.
Imho Frontier need a poster-child for "Don't do this, we will ban you", It's now very very well known they are taking a soft-handed approach, cheating websites brag about it, articles in popular press even reference it, until a publicised example come along no one will take it seriously (as is being evidenced by SDC deliberatly attempting to bend the rules).
Steam has very little cheating, the reason is very harsh consequences possibly loosing hundreds of £/$/€ on your account. As such people take it seriously and its generally made it a better place
Possible routes forward from my perspective:
SDC clean up their act, become more about PvP rather than the controversy and salt and become a highly skilled and respected part of the community where they can make good suggestions to FD about balance and game changes/tweaks that may actually get a positive response.
Or
SDC can continue the salt and controversy, eventually go a step too far and see some or all of their group shadow-banned or perma-banned. See it from FD's perspective, if all Mobius' group quit it's a bigger financial and numeric loss than the skilled PvP players. Yes the game would loose something If SDC quit or got banned or both but let's not pretend that all PvP players would suddenly jump ship. Also it'd be interesting to see how SC and NMS etc would respond to the same type of play and bending rules, It could prove quite expensive for SDC though, especially those uni students (been there, done that).
Finally the labels, jeez I'm getting a little annoyed now, congrats SDC, can you retire now?

I play Open, I've killed people, I've pirated people, I've interdicted people. Am I a griefer?
I've played Mobius, I've played solo, I've taken part in fuel rat operations, am I a carebear?
Being both simultaneously is a bit difficult, I need some help...
If this comes off a bit one way than the other I did warn you but lets get real, lets not pretend or provide excuses, they can always be found especially where very washy and unclear rules and regulations are applied. Also Happy April Fools Day to all. I'm shocked there was no SDC April Fools operation, ah well, there's always next year if they still exist.