Agreed. We can't ignore that in many cases, students are in competition with each other for grades. If there's a reasonable assumption that the others have an unfair advantage, you're really not left with an alternative other than to cheat yourself. I think it's fair to compare it to the prevalence of adderall at universities.
I took some graduate courses in an online environment back when that was a relatively new concept in the late 2000s. Everything up until the midterm and final exam were online, and I had to physically go to a designated test area for those. I felt reasonably assured that everyone else was being held to the same standard.