I'm going to give a slightly different perspective on why I don't think eliminating cheating in PvP will kill membership in UO. The reason I believe this is because I agree with what some of the PvPers have said, that the elite PvPers do not need hacks or scripts to kill 98% of the other folks in UO. I've fought with and against some of the best, and I while I'm decent and can hold my own in most situations, I do know real skill when I see it. The simple fact is that these really elite people do not need cheats of any kind to kill someone like me (and I want to point out again, I'm pretty good).
But the fact remains that there are people that do cheat, whether through using speedhacks or one of the scripting programs (I guess I'm not supposed to mention any by name), or some sort of client modifier (like the UO Assist substitute). I think that they cheat in order to compete with the other elite PvPers, but I totally agree that they don't need their cheats to kill the vast majority of people in the game.
Now, if UO were to successfully eliminate such cheats, I think a lot of those people would remain in the game, and still be among the top PvPers without cheats. Maybe I'm just optimistic, but that's the virtual world I'd like to see. Where, after a fight people didn't rant on-and-on about you cheat, you speed, you script, etc. I don't believe that these people will necessarily quit UO because they can't cheat. If the word gets out that cheaters will be banned, I think they'll stick around and find a way to be elite with cheating.
Now script resource gathering...I do wish they'd do something about that but it looks like they haven't yet.