That's not necessarily true. Like with pricing anything else, the maximum total revenue is at a price that's neither 'too low' or 'too high'. And the residents of Venice seem willing to forego some revenue for less tourists anyways.
Exactly. Artificially reducing the supply of diamonds doesn't reduce profit. It increases it.
Except that they specifically said "raise more revenue from each tourist" and "while cutting maintenance costs". Both of those seem like they would negate your point.
One of the problems has been people arriving on these ships and not spending any money locally. Everything they need is provided on the boat.