Most major subreddits show a decrease of between 50 and 90 percent in average daily posts and comments, when compared to a year ago. This suggests the problem is way fewer users, not the same number of users browsing less. The huge and universal dropoff also suggests that people left, either because of the changes or the protests, and they aren’t coming back.
Looking at the subreddit stats data it honestly looks more like automation died when the APIs were killed. You can see just a clean drop of 75% on July 11th. I don't think that was all of the content creators suddenly dropping it on the same day. There were so many reposts and botnets that were reposting comments from imgur and old reddit posts and whatever on the big subs that I totally believe the organic traffic on reddit is sub 50%.
That being said I believe that the big hole that automated content filled (resurfacing vast amounts of the most engaging content) will really hurt engagement of humans and the humans will lose interest over time.
If you're trying to sneakily manipulate karma and content, you don't want to be doing it through the API, you want it to look like legitimate users so it doesn't get blocked. This usually means some kind of browser automation.
Of course, reddit does so little to combat it, maybe there really were sleazy astro-turfing botnets just accessing the site through the API.
Back in like 2018, reddit posted some user stats, including a list of "most addicted cities". They forgot to scrub the results and Eglin Airforce Base was the top rank.
The fact that it wasn't blocked implies reddit admins are OK with the airforce's botfarm, and would allow them to use the API.
Yeah I don't really know. Something else that could have happened is that Subreddit Stats just stopped reporting the counts correctly because they rely on the API.
If I recall correctly (I might be wrong), July/11 was when the 3PAs stopped working. Regardless of that I don't think that those karma farms relied on the API, because as @PoliticalAgitator said they want to avoid shadowbanning.
However, if we follow your reasoning, it's still a fucking dumb move from Reddit Inc. to kill what made the place active. The issue with bots was never their usage, but rather that they went unmarked, pretending to be human beings [re]posting stuff.