Sounds like a competent software engineer got a hold of Fdev's code and realized just how shoddy it is. If Fdev were smart, they would hire that guy.
Let's talk about cheating:
In the old days, games used to come loaded with cheat codes. As a kid, I used them in games like Doom and Quake to allow me to experience the game without being afraid. As I got older, I realized the games are a lot more fun with a bit of challenge. Now days I play almost every game on the hardest difficulty and often mod single player games to make them harder. Cheat codes help players tailor the game to their needs. Just take a look at Celeste, the developers openly acknowledge that the game is HARD, and they have a helpful cheat system that allows players to continue playing when they may have quit otherwise. (They learned from Cuphead.)
So when are cheat codes bad? When they take the fun out of a game, or when the game is meant to be competitive and one player has an unfair advantage. I can't tell you have many LAN Quake games I played that started out as coop, someone died from friendly fire, and full death match erupted. In Quake coop, people spawned at the start and had to find their weapons. If you died from another player once, you probably wouldn't have a chance to grab a gun before they killed you again. Cheat codes were often used, and the game would shortly be switched to death match after so we could kill each other properly.
There are times it's better to give some players an unfair advantage, just take a look at Halo's handicap system, or many fighting games for example. These handicaps allow a less experienced player to play with someone more experienced, while still providing a challenge for both. This is something that so many games get wrong. Level up, get stronger, get better guns, get blah blah blah that new player doesn't have. New players need the advantage, not experienced players! That's why MMO's generally fail as e-sports. It's also why CQC is fundamentally broken. The person playing longer does not need a handicap favoring them, they already have a wealth of experience to draw upon.
Now let's talk about bots. People use bots because they either don't have the time to play the game but still want to play with their friends, or they would rather do something else with their time than play the game. "The ends justify the means". What people tend to forget is that when they reach the end, it's the end. It's not reaching the end that's important, it's the journey we take to get there. If a game is fun, people will WANT to play it. They won't skip straight to the end because they are missing content/enjoyment.
Fdev's Skinner box mentality has people grinding for hours on end for a small stat increase. Some people will find this fun, but most find it tedious after a while. I personally love driving around on planets looking for cool sites and seeing what I can find. I HATE driving around rocky barren planets listening to the scanner to try and find materials. It's not enjoyable to me, it might be a bit more enjoyable if I could listen to a podcast or show, but that's hard while listening to the scanner pitch.
Fdev's problem is the same problem that many content providers have with piracy. Piracy provides the same content with better service. I can pay money to hulu to stream content, and still have the show interrupted for 30 second ad breaks, with adblock that's 30 seconds of a black screen. Or I can use a pirate website and watch without interruptions. The pirate website has a better product, so people who know about them use them. The television industry is still improving, but most people would say Netflix does a good job. In fact, I use them over pirate websites because they provide a better service. They can suggest shows that I may like, and they do a good job at it. There is a reason Netflix has been successful and has the money to make their own shows.
The music industry was the first major piracy focus. In the 2000's, everyone was downloading and sharing music. Then providers figured out they could stream music and provide a better service. Now I listen to Spotify or Pandora instead of downloading music, they improved their business model and it's easier to use their service than try to download what I want.
I mentioned before, I don't use cheats, I enjoy a challenge. However, I would very much consider using a program that allowed me to change my hud and bypass engineering. Why? Because if I wasn't worried about engineering, I would be flying 15 different ships and having a lot more fun. I have the funds, but I cannot stand the engineering grind. As a result, I have not touched any of the ships that have been released since Horizions. Would I have fun in them? Yes! But, I won't enjoy the journey to get there, so the end results aren't worth it.
Without a PvP ship, I will never PvP.
Without a canyon racer, I will never canyon race.
Both of those activities would be a blast to me, but I've given up on it because I don't enjoy the grind. Searching high grade energy sources was mind numbingly boring. I play games for fun, not to beat my head on a wall.
TLDR ~ The problem is not cheats, the problem is that people aren't enjoying the game for what it is. Games are about the journey. The journey needs to be fun. Somewhere along the way Fdev forgot what fun is. Look at material trading, it's a band aid for trying to find RNG materials that are too hard to find. Nothing about the system was designed to be fun. Nobody wants to search the galaxy for material traders, they look up their location on a website. Nobody wants to visit 3 different traders to finally get what they need.
The cheater dev took a system that was good, and improved on the aspects of the game that aren't. They then made the tools public (which arguably destroys the competitive aspect as the OP pointed out.) If Fdev had more people who saw the glaring problems in their game and worked to fix them, fewer people would be looking for cheats. In fact, if Fdev started focusing on fun instead of grind, I'd be throwing money at them.