To be fair, you do state that you want people to be able to do bad things for themselves, but penalize them if that affects others.
That makes sense, ethically, but only if A) people are actually fully aware and accountable for the consequences of the 'bad thing' and B) the 'bad things' are side-effect free and/or the people who cause bad side effects for others can be deterred by harsh penalties - which actually only happens if the chance of getting caught is high enough.
I think A and B aren't actually feasible for most things, except some classes of drugs maybe. For A you would need such restrictions that the market will revolt or simply die off. Things like obtaining a license after doing an exam or something like that. As for B, the vast majority of bad things have unavoidable effects on others, and for some the potential for abuse calls for unreasonable policing.
In practice, I think humans function much more as a collective than they like to admit, and individual autonomy is a kind of window dressing of the status quo, rather than anything substantial. Like the fairly trivial choice for product A over product B, where they are nearly the same. But its really hard to choose to work for 3 days and accept less wealth, or something meaningful like that.
Thus, I can't really perceive a lot more freedom in the current neoliberal market than the hypothetical nanny state, especially as this so called free market is full of rules and the consequences of other peoples 'freedoms' are forced upon me.