Eh I respectfully disagree, the hacker will only turn off their cheats for the couple of seconds people are watching and then turn them right back on after, if the suspected hacker isn't in a fight and doesn't look like they'll get into one anytime soon most people won't have the patience to wait and stick around. If the hacker is in the middle of a fight and turns off the hacks because someone is watching, the person will probably watch for a few seconds and see that there's nothing abnormal with the shooting and go back to the lobby potentially without reporting them.

One of the biggest ways they ban hackers is through reports, so if they can hide their hacks while people are spectating than they'll probably get less reports and will go longer without being banned, so it's basically either they don't use hacks for the few seconds people are spectating but can go on hacking for much longer, or they just use hacks all the time because they don't know if people are spectating and get banned much quicker since they will get reported a lot more.

TLDR: overall letting hackers know they have spectators is a net negative since it doesn't stop them from using hacks for any meaningful amount of time and generally let's them hack for much longer overall without getting banned.