Oh well. Assuming they are not going to come back under another guise (or if this is just a few minor players) then while SX were not the easiest folks to like they have done some good stuff for those that do enjoy having a hacked device. If this basically leaves atmosphere as the only source for such things I hope we either get an alt or someone forks it nicely and puts in the good stuff and missing features, though given it has been years already and nobody stepped up to take over (and similarly hacked consoles have been serious business for how many years now in general with the same thing being seen) then yeah.
I don't know how much longer the Switch has left before devs jump ship and we get the odd bit of drip fed shovelware but I do hope we can still get some kind of really nice download and install this for the Switch if not end of life then effective end of life.
I also wonder when SXOS will become not just a bit long in the tooth but untenable (that being what games and combination of OS features mean you are seriously missing out).
Re paying for piracy. I am still not sure what particularly bothers people about this. Almost wonder if they are bothered because someone said to be bothered.
Generally speaking one busts out the wallet because someone can do something better than they can, or do it quicker/more easily. I don't replace the brakes on my car because there are many things to look for which I might not necessarily know to look for, I can't get as cheap a price on pads vs someone buying dozens per day and laying on the gravel of my driveway to put them on and check things is a pain, even when gun to head I could happily do such a thing. If SXOS offered more features, more stability and an easier entry route then... that is all a lot of people care about and if the cost of entry is nothing drastic (if you are spending more on a decent SD card + hard drive for it all...) then even better.
Can Nintendo go after soft mod devs or is it only when they make money off of exploits and hacks?
Potentially.
There are all sorts of laws in various places regarding the bypassing of DRM and such protections. You also have the "you are a broke student and speaking to a lawyer will probably be all your fun money for the next month, we have a whole department we can task and not even notice the money gone unless we look" method of lawsuit (see also the recent efforts against ROM sites). Such things can be a bit dangerous for Nintendo for a few things (if they get ruled legal by some quirk it is worse than leaving it as a grey area) and there might be some rich benefactor or something like the EFF spoiling for a fight so it is not assured that they will.
From what I have seen Atmosphere also walk right up to the line as well and make it blurry even then (see all the various responses around here about code not includes, patches and whatever else, some of it is complete nonsense but there is truth to others). You then would also have to explain the case to a jury of presumably non technical people and that is also something to avoid where you can. Give me a jury full of coding proficient law students and... only thing saving them is
nullification.
Money just leaves a trail (jump on a VPN/hacked wifi to post source code updates, that "others" have to make patches for to allow the fun stuff, with a minimalist NFO vs eventually having to interact with the banking system to either use the money* or pay your suppliers), makes various investigative techniques easier (the bypassing DRM is a far lesser offence than money laundering and places are far more inclined to investigate that), makes investigations themselves easier (if you can't contact an anonymous coder then you are going to struggle, if you can pretend to be a vendor looking to buy 1000 of the things then all sorts of things get arranged and traps able to be laid), makes various laws a bit harsher and thus makes lawyers perk up as there is also a chance they can get a cut of it when they do catch them rather than trying to extract millions from a broke student.
There is also a reason 99% of cases you will ever see will hinge more upon people installing ROMs (or films in the case of XBMC/Kodi boxes) onto the devices, in this case the selling access presumably being that service that was offered. The press releases associated with it will play up the installation and supply of devices angle because that is scary to the kids and parents mostly funding such things, most people on this sort of thread presumably seeing past that, but ROMs are the bigger concern for the case.
*very few big ticket things you can buy in cash these days (probably not a house, cars are tricky, have you seen a computer shop lately?) and you can't really rock up with $50000 to a bank to deposit it without questions being asked.