I wonder if the "third way" here isn't more "by dropping prices and making drugs more affordable many drug users are less likely to engage in petty crimes to raise money to pay for their habits"

EDIT: Should probably emphasize "addicts" to differentiate from recreational users.

What I wrote about isn't just the end users, or them committing crimes. But even as an end user, if your dealer shortchanges you or gives you counterfeit currency, or even whacks you over the head, you have no real recourse via the legal system. You'd have to take matters into your own hands. Similarly if the dealer has things like that happen to them, or even "contract" violations with their supplier, they too have to take matters into their own hands.