Exchanges are already making far too much from listing fees, so IEOs on top are completely unnecessary. While they are good promotion for coins, such practices cannot be good in the long-term.
These exchange owners are businessmen and they will pounce at every opportunity to make money. I don't think you can put them in a bad light for seeing a demand and providing solutions to retail investors issues with ICOs.
Instead, the focus should be easy-to-use decentralised exchanges which don't require intrusive KYC/AML and are much less likely to be corrupt/ill-willed if some DAO-like structure is in place. While blockchain technology has made the storage of data much safer, what is the point if thousands of crypto exchanges hold endless amounts of data on the customers in the same way banks do? The only thing changing is who owns the data, so privacy has not improved. And as crypto adoption increases, so will regulation of exchanges.
We don't want to end up in a situation where to trade any meaningful amount of crypto you have to send your name, address, ID, and bank account details to some exchange which can do whatever it likes with your data.
Out of all the CEX that launched their IEOs, only Binance was able to have their own DEX (or hybrid dex). It maybe asking too much for these CEX to go for decentralization at the moment especially now that even IDEX had to require KYC to all its users.