I think the changes are a good step in the right direction. Maybe it would be a good idea to create more responsibility for the players themselves.
It could be a good solution to give the players a chance to handle the situation themselves. If player1 reports player2 than player2 gets a message that he is reported and can see the evidence and has a chance to find a solution with player1. Just if this escalates or they can't find a solution together the report has to be send to a game moderator.
So First level players themselves
Second level Game Mods
The Game Mods should be able to see the conversation of the players and judge the behavior of both players within the hole process.
So players should be able to ban other players but the reported player has to accept the ban request.
There should be a system that report forwarding will lead to a higher penalty and there should be a penalty for unnecessary forwards for example if one player don't want to find a solution.
I believe in the goodness of humanity!