Now you are correct, and carriers responded to those demands from users for mobile networking with (usually metered or priced as an addon) "mobile hotspot" applications.
Contrary to your earlier claims, the advanced Android and iPhone user communities are not insignificant and may have played a part in getting demands like these met.
Places like androidpolice, and sites like engadget, lifehacks, gizmodo and others cater to this market, and drive popular knowledge of root modifications and jail breaking. Previous incarnations of Cyanogenmod boasted large numbers of downloads in the 100s of thousands if not millions.
Your attitude seems to be "I should be able to get a cheap phone from a carrier by agreeing not to tether, and then I should be able to violate that agreement anyway, and this is a totally moral position". Phones are a commodity. You can get them anywhere. Want to tether? Buy a phone and a plan that allows it. Problem solved.
Which is why it baffles me beyond all limits just why so many smart Americans go out of their way to defend corporate practices that hurt them as customers.
This really isn't complicated. If your carrier contract doesn't forbid tethering but they sold you a phone that does, take it up with them, that sounds messed up and rare. If your contract forbids tethering then you're just trying to weasel your way out of a market you voluntarily entered in to. That's the opposite of the free market.
Why are you trying so hard to support your telcos decision to make your life worse?
If everybody in your neighbourhood turned their faucets on at once, water supply would simply stop working. So?
There really aren't any reasons to try and root an Android phone. If you want to replace the OS with some custom open source build, just use a phone with an unlocked bootloader and go wild. But you can already access so many features and customise so many things without root it hardly seems worth it.