At which point the exchange value of Bitcoin plummets, so you turn your $3.5 million in daily block rewards into nothing.

Not necessarily. A smart actor with massive hash power (enough to stage a 50%+ attack) would gain the most by using a Sybil variant to subtlety take control. There is no reason to be overt if you can conceal the connection between "independent" mining pools.

We might disagree on what a 51% attack means.

A single actor controlling a majority of hash power isn't a problem. Double-spends are a problem. If anyone double-spends, it will be noticed because there will be a permanent record of it in the form of orphaned blocks, and bitcoin value will decrease because Bitcoin transactions will have become less trustworthy.

Thus, even in the case where a single actor has 51% hash power, that actor has a strong financial incentive not to conduct a 51% attack.

The Sybil-style independent mining pools you describe aren't really hiding what people would be looking for, which is a coordinated preference for the fork that causes the double-spend. (Plus miners would have to accept the relayed second transaction into the mempool to begin with, which today nobody does. RBF might have changed this, but even then you should still be able to reason about whether anyone is even contemplating allowing a double-spend.)

I'm not sure if I'm talking past you -- am I correct that we disagreed on what a 51% attack looks like?

Double spends attacks aren't the only issue when you have access to a large portion of the network.

Malicious pools can prioritize their transactions and manipulate activity in the network to grant them as many block rewards as they want.

No one would really notice, as there's no way to prove it.

You just steer as many block rewards as you want towards your accounts, maybe give %10 to normal users.

That's an interesting claim. A miner already receives the coinbase and transaction fees for the blocks it completes, and it can't change the contents of blocks it doesn't complete, so it can't steal those blocks' rewards. Those are the only two groups of rewards, so no, the miner can't use 51% hashpower to get any part of the other 49% of block rewards.

"Giving ten percent to normal users" is also a novel concept. I have never seen coinbase awarded to any address but ones having a relationship to the successful miner. Are you under the impression that normal users usually get some part of block rewards? They don't. (I'm not sure what a "normal user" is, either.)

Nor can a miner change the destination of funds in transactions included in the completed block. That would be isomorphic to calculating private ECDSA keys from addresses, which is not possible with Earth technology.

Finally, the miner can't simply change the rules (for example, including both parts of a double-spend in a single block, or substituting a different signature for others' transactions). That would cause a hard fork, and every client on the planet would choose the side that followed the rules.

According to the design and implementation of Bitcoin, your statements cannot be anything but wrong.

On an unrelated matter, why do you put the percent sign in front of numbers? I have never seen that before in any language, forum, or writing style. Not only is it stylistically uncommon, but it's incorrect inasmuch as the % symbol is short for "per hundred." It wouldn't make grammatical sense to say "give per hundred ten to normal users," which means the prefix symbol doesn't make sense, either. Where are you from, if you don't mind my asking?

You are only considering what is possible with a solo miner, the attack described involves multiple miner nodes colluding in a pool to suppress, delay, and orphan transactions and blocks.

I'm from Moon.