What will actually happen is this stuff just becomes less accessible to poor people and now their child had no safety equipment at all instead of a 1/100 chance of a recalled item that probably still would be better than nothing.
If the regulations cover everything, well then either the marketplaces all shut down or they cost $10 per listing and require you to agree to a lot of legal consequences if you provide wrong info in your listing.
Ideas like this only sound good to people who imagine no consequences will ever reach them, just billion dollar corporations.
The reason I do that is because I can ascertain the quality of the clothing and determine that, despite them being cheaper and used, they are just as good if not better.
I'm sure there's a lot of parents who assume, incorrectly, that a used and relatively clean car seat is just as good as a new one. So, they save a few bucks because why not?
Unfortunately when a new child arrives finances tend to be at a minimum and this deep discount works out as a almost always better than nothing and for super cheap.