Highly unlikely. The spoofer places orders below the best bid and above the best offer, and cancels almost immediately. He doesn't want to get filled. His purpose is to artificially distort the order flow, i.e. create an (false) impression that the orders are going in a particular direction. Yes, that has been proposed, and it would making spoofing very difficult and risky. That's debatable. In the free market economy, we do have controls for price fixing, monopolization, unsafe products, and criminal enterprises.
I don't understand then why people react to these orders then. Wouldn't the market eventually figure out that these orders are just noise and treat them as such?
Sure, but the regulators need something ambiguous and illegal they can pin on people they don't like. That's almost all they've been doing in recent years - making up negative sounding names for things that happen in the market in the normal course of events and declaring that they might be illegal depending on your intent (as determined by them).
Think of it as a temporary sacrifice to gain the initiative. You are paying for the privilege of being in the front of the queue. Let's say that you sell apples at the farmer's market. There is another seller over there, selling at $2 per pound, and no other sellers. Let's also suppose that your cost to grow apples is $2.01 per pound. To "drain the queue", you buy all apples from that other seller (taking a loss of 1 cent per pound), but from there on, you are in control. For example, you can set the price as $1.50 bid, $2.50 offer. That's of course a simplified scenario, but the same principle applies.
Your example makes sense in illiquid markets, like the one you provided in your example, but I personally think it is useless in a stacked order book. Of course, maybe this one type can combine with faking volume, then I would agree. But your example makes sense, thx. I personally think the quote stuffing is the most outrageous, almost all the others probably happen all day. Besides the quote stuffing, most of it doesn't bother me tbh, if you have the biggest amount of money it would make sense to cover your tracks in DOM if you are worried about intelligent people trying to analyze your moves (theoretically). If those were all your examples from above you did a pretty good job of explaining things, imo.
I have made a fairly large percentage of my career income spotting spoofers. They are free money when they are in there. I can't believe people fall for them to be honest. If you have any questions let me know I don't mind explaining.
How is this even possible? If you are hitting the same exchange, the guy cannot cancel it. Unless there is information leakage from you or your broker.
Do you still see a lot of them on your markets? It would be interesting to see if some are so profitable that they take the risk of prosecution...It's totally moronic but it is human nature to believe it only happens to other people...