A block size increase “based on demand”, and leaving it to the miners to decide how large the blocks should be “based on demand” is a very dangerous proposition, topcoin360. It will open an attack vector, that would possibly disrupt the network.
As far as I understand, you do not want to allow miners to increase the block, because they will have the opportunity to hack the system. Very strange reasoning. After all, miners ALREADY have a 100% chance to hack the system. If, of course, they have such a collective desire. For example, they can start mining empty blocks. Or make a 51% attack. That's all, the system is broken.
It looks like this: a person has a full warehouse of weapons. And you : we can't give him a loaded gun. He will have the opportunity to kill someone.
The security of the bitcoin system is 99.99% dependent on the miners. And if you give them the opportunity to change the block size, nothing will change. Similarly, the security will be 99.99% dependent on the miners.
The miner can increase its income due to the fact that users will pay a large commission for the transaction. This can be achieved by reducing the block. Or by setting a high commission for the right to be included in the block. And the miners ALREADY have such an opportunity. Miners can set any commission they want. To do this, they do not need to "fake demand".
A couple of years ago, a delusional idea was popular that miners fill blocks with their transactions (fake demand) in order to artificially increase the mempool and thus earn more commissions. Miners ALREADY have such an opportunity.
Delusional ideas die very hard.