If the operator declares that his/her game is a ponzi and the last investors will lose money, then every participants will know what going to happen and then they can invest accordingly.
What happens if the operator pays interest but stop just before the first investor breaks even?
In that case everyone loses, including people who invested first.
There is no way to know the operator isn't going to run off with the money before paying interest and no way to tell if the people claiming to be paid interest are not the operator or working with the operator.
Just because an operator is open about the scheme being a Ponzi doesn't make the scheme honest or any less risky.
The truth is that some time in the future the scheme will collapse and/or the operator will run off with the investors money.
A "honest" scam artist is still a scam artist.