I wonder, if instead of trying to regulate these companies, it would be more effective for the government or some sort of support organization to award a grant to some free software developers to flood the market with actually free "casino simulators."
Similar to the "give drugs to drug addicts" approach. Give them something of minimal harm they can use to satisfy their addiction until they can find a way out.
It's not like these would be particularly difficult apps to make, just need some good UX to make feel satisfying.