I think the risk of developing a long term mental illness from psychedelic use are overstated because of societies stigma with temporary psychosis. A healthy person can come back from those "psychotomimetic" episodes really quickly, even quicker than with opioid induced psychosis. It's not really mysterious or undesirable as you make it sound. People that develop long term issues from psychedelic use are also at risk of developing those from basically all other psychoactive substances, specially marihuana and opioids.
The motivations for making psychedelics schedule 1 where political and not related to that risk at all though. Drinking a lot can also create temporary psychosis and long term personality changes. There's also lots of studies about how marihuana also results in psychosis or triggers mania in some people. Neither alcohol nor Marihuana show as promising results for things like fighting depression, fatigue, social anxiety, as psychedelics or at fighting PTSD as MDMA does.
Alcohol and now weed are legal mostly because of other economic and political interests. The sad reality is no one gives a fuck about the people that could benefit from research into psychedelic medicine, except pharmaceutical companies that make billions out of treatments that are 20 years behind, and they want them to be schedule 1 forever.