Sure maybe the rules need updating but using a loop hole to just completely ignore all of them and the having its users complain about 'unfair business practices' is just mind boggling.
Uber is becoming the mob 2.0
Medieval Town invites in Duke. Duke promises to fight against the injustices of the King. Eventually the Duke becomes the King. Repeat ad infinitum.
At some point, the usurper will become the establishment.
Don't let perfection get in the way of improvement.
Plus, with uber you can easily give a low rating, then drivers will disappear from the platform within long. This is why behavior like this isn't widespread, and why it's better than taxis..
With Uber you have a much lower probability of being scammed and a much higher probability of getting your money back after it (with taxis the probability of getting your money back is basically zero).
And by the way the probability of being scammed at all increases not only by being a foreigner, it increases only by being from another place and not knowing the city. There are dozens of cases of friends of mine born in São Paulo who got scammed by taxi drivers in RJ. With Uber/Cabify/99 this became much less common.