>This is good for them because they might be able to get TLSA at $1599.20 and sell it to the User at $1599.84, and it's good for the user because contracts have a narrower spread and they can give the user the price they saw when they sold it (vs Schwab, which gives you direct access to the market so you need to set limits)

This is not quite accurate. The user doesn't get a better price from a dark pool than they would in the market. They get filled at the market price. It's illegal for it to be higher and Citadel/Robinhood aren't going to leave money on the table by filling it cheaper.

Citadel is willing to pay Robinhood for their order flow because it is less risky and therefore more profitable because Citadel won't end up on the wrong side of a trade. Robinhood uses this money to fund their business and takes any excess as profit.