If altcoins are not being considered for SC's, why do they dedicate a paragraph to Freicoin in the Economic part of the paper?
I still haven't heard a good excuse for core dev concentration in one for profit company other than "trust us".
Again, why wouldn't we expect a SC fork of bitcoin with perfect anonymity to take over?
I love the idea, but I don't get how a dark 1:1 pegged SC can have a security incentive if you are only mining for fees.
It will happen. There are plenty of good reason for a sidechain to use the anonymity feature of, say, Monero. What cypher fails to consider here is that a new currency is not necessary for this to exist. The altchain will leverage Bitcoin's currency and benefit from its network effect.
Improved payer privacy, e.g. the ring signature scheme used by Monero, can reduce the systemic risk of the transactions of particular parties being censored, protecting the fungibility of the cryptocurrency. Improvements to this have been suggested by Maxwell and Poelstra
400 [MP14, Poe14b] and Back[Bac13a], which would allow for even greater privacy. Today, ring signatures can be used with Monero coins, but not bitcoins; sidechains would avoid this exclusivity
I'm not sure about your security incentive question. Merge mining allows for hashing power of BTC to be shared with the anonymous altchain in a trivial way.
So tell me cypherdoc, what is more likely to catch on?
A 1:1 pegged sidechain with anonymity features or an anonymous sidechain issuing its own currency distributed in some malicious, hypothetic way that would benefit the Blockstream developer?
IIRC pre-mines have never really been popular or successful.