How is cheating only an issue in academia? It shows a lack of ethics and a lack of knowledge on the part of the student, and these are things that are quite important to being able to do a good job in the real world.

You say "the current system is stupid", "academia is an artificial world", and "past projects and word of mouth" are what matters. Past projects and word of mouth are both systems that are ripe for manipulation by having the right social / marketing skills. Coincidentally, you can also appropriate other people's work and pass it off as your own, perhaps without getting caught. I think I'm beginning to understand why you value these highly.