Isn't the point of prediction markets to predict the outcome most accurately for forecasting? Insider trading would be an ideal way of doing that.
It's only the point if you want to facilitate betting without being regulated.
I think what you are describing is called polling. This is gambling. Insider trading would be like bringing your own deck of cards to the casino and not shuffling them.
While "insider trading" harms prediction market participants, insider trading provides useful information to prediction market observers.
I think those prediction markets need to have the same regulations as casinos at this point.