>What's not fair is removing a paying passenger against their will for no good reason.
No, it's not fair, but it wouldn't be fair to remove another passenger because this one felt he was too important to be bumped.
>United could have just increased the compensation until somebody left willingly.
Sure, and United paid for that mistake and then some. But just because they made a mistake doesn't mean the other guy did not act like a psycho.
>they chose to involve law enforcement, with predictable results.
Those aren't predictable results. Predictable results are: "United involved law enforcement, and the passenger left the airplane promptly". A more typical scenario would see him leave way before United called the cops.