Yes, agree with all your points @OHMomof2
Point is that schools practicing this behavior, all the while communicating they are need blind with respect to admission, is disingenuous. If a recruited athlete has an EFC of 0, is admissions more likely to say no to the coach? It raises many questions.
What it seems is that some LACs (keeping with the example) would know financial status prior to admission of a significant proportion of those who are offered admission: slotted athletes, likely the athletes with soft support from a coach, some legacies, development cases, Posse and Questbridge students. Is this holistic? Holistic only for the applicants who don’t fit one of these categories? Need blind with respect to fin aid? A slippery slope to be sure, with much gray.