Disclaimer: I own some (not enough, I wish more).
I think your points were valid when cryptocurrency first started, but now it's now a bit too entrenched to be easily squashed.
1) Many miners use renewable energy. China uses a bit of coal for mining, but recent news (or FUD) has most miners scrambling for "greener" energy. Bitcoin's energy usage is talked about quite a bit, but doesn't seem to really dissuade.
2) If Bitcoin had been started by a large organization versus grassroots - this likely would have been squashed. Instead, considering now how widespread it is, and how many politicians own crypto, along with Coinbase being affluent enough to lobby against this - this scenario now seems unlikely. However, I do agree, there will be a fight for monetary control and it may be ugly, but ultimately cryptocurrency will survive in some way or another.
3) Yes - in the beginning, the vast majority of crypto in was used for illegal reasons. Monero is probably a better use case as it's untraceable. Bitcoin has a public ledger making it much easier to track. However, the percentage of overall transactions (crypto) for illegal activities has decreased over time.
USDC is probably the best bet of what you're imagining of a crypto pegged to the US Dollar. It also allows for a blacklist of addresses known in illegal activities.
With all that being said, DeFi may prove to be a larger use case, as it's now possible to create "virtual" banks that run on code and no humans, etc.