I agree that memorizing words or kanji in isolation from the target language material is not an optimal strategy, whether one uses mnemonics or not. It is not relevant to your argument against using mnemonics.

In addition, in my opinion you understate the usefulness of mnemonics to assist in learning. If we're to agree they do help with learning faster, you might still object as you wrote: "You can go through an entire book of mnemonics that teaches you 1,000 Chinese characters and retain none of it.". It's not much of a concern if one uses spaced repetition software like Anki.