I can see this being a double edged sword in all respects. On the one hand, you have the good players that can report people for the good of the community, and clearly spot "hacked" gear, but on the other, you may get reports that are super fishy and may not be true at all, but getting items are hard to prove without pictures.
It's unfortunate that our only way of proving whether or not something's hacked or not is whether they have a picture of getting it or not, or if somebody can vouch for them, as I'm sure you all know, each item has it's own hex code, but no matter whether your item is hacked or not, it will have the same hex code as all the other items of that type. If it were possible to create a client program that can detect outliers (?) in the coding process of items, like, say, the tool can detect when an unidentified item maker is currently being used, and a warning at the top of the screen as an announcement pops up, giving the guild card and item being created as a source of reference to who used it, I can see that being a great source of watching said cheaters.
I feel there are many ways to determine who is a hacker and why, AntiHack.dll does a good job at that, it's why recently there haven't been any cheaters or hackers over there in a while, Antihack.dll has never really had anything to do with stopping programs that are "related to hacking" on your computer, all those theories have been recently debunked by Crono and Lee themselves as just issues with individual computer firewalls going ape shit. Although the irony is not lost on me as to how this AntiHack.dll file would be ineffective on Ultima (because it's not created for Ultima, it's created for another server entirely), there could be versions created that do help solve some of the issues we face today.
Honestly, the GM staff does an excellent job at doing what they do, and Larva is hard at work I'm sure doing what he can, running a server is no easy feat, it's very difficult, and I praise them for being able to handle such a gigantic task, but I do feel like this is something that people can suggest features for to maybe help improve the security.