The main cheaters exploiting sv_pure 0, are at maximum, wallhackers. Nothing more. Those guys using bots, recoil/spread manipulation are using a higher level cheat method which is totally different. Simply speaking, sv_pure 2, is a very good low level anti-cheat guard. I would be more inclined to call it a prevention mechanism.
To explain in a nutshell, all you have to do is download models or maps (what we call skins) and throw them in your cstrike folder, then join a sv_pure 0 server. I haven't submitted a demo yet but one particular guy was blatantly walling and immediately after this svar change, his ability drastically was reduced. It may be the same guy who opened this thread, who knows. Though since he's not doing it anymore, I'd figure I'll let him be unless he acts like a wise guy over the mic etc. Just a note, that guy was hilarious. He knew where people were and would always mistime his strafe awp shot peek. So he'd shoot while moving and the bullet who go astray. He'd repeek something like 4-5 times and eventually get snapt.. was f'ing hilarious.
The advantage is, there is barely any cheaters on CSS#7 anymore. No one calls walls, barely anyone looks suspicious. Whereas before, there were regulars that I personally held in high suspicion. Some demo'd and sub'd. Some you couldn't quite catch since they rarely make mistakes and blow their cheats wide open. I keep track of a few STEAMIDs to avoid those re-aliasing and I've noticed some of them are gone. I'm willing to bet these peeps are gone, not just on holidays, but gone for good.
That is, until they find a hack that does the same thing but only this time it's a totally different type of software manipulation. This is where VAC steps in, that's the kind of stuff VAC picks up and bans. I have no financial benefit in reading the Valve developer wiki but with my training and experience, I can probably assume fairly accurately what's going on and why these decisions were made. If I had to list a few methods of alternative cheating (don't worry, noobs probably won't get anywhere with these - and if they were successful, it'd be blatantly obvious) are probably packet altering (sniff->redirect/manipulate), memory address variable manipulation. VAC may
detect things like that, because that's exactly what it was engineered to combat. VAC doesn't know if people are using dodgy skins because that's not it's job. Their solution to it was probably half-assed but simple; sv_pure. Let's leave it to the server admins to decide. Just a side note - I don't remember exactly, but sv_pure was not an option in the original CSS at release.
Believe me when I say other game genres apart from FPS have much higher difficulties to cheat in and to also detect! There are a lot of VAC-like/EAC projects out there for those games designed by 3rd parties, and they do a pretty fine job. FPS you can make an accurate judgement while observing cheaters in my opinion. WHereas something like simracing, it's nowhere near as easy via observation. Some people are just ridiculously quick. There's money and fame involved in that and people don't "LAN" with that type of game.
Punkbuster back in the CS1.x days was the same thing! What a blast from a past that is. Horses for courses. Same principle applies to the type of cheats and the type of detection/prevention. I think PB is still around but moved on from a 3rd party non-profit project.