I'll tell you what tipped the staff over the edge, or it happened very close to this story...
Someone was running a 1/1000 chance to get a fungi, you could roll for 100pp and if you hit the lucky number the "dealer" was looking for, you won yourself a fungi!
Players who might not have even had the fungi were gambling that people wouldn't hit, and when someone did... and the "dealer" inevitably had "connection issues" and thats a whole headache/petition/RMT concern/etc.
So yeah, no gambling. Nilbog did at one stage think about adding a casino bot, to help as a platsink as much as anything else... but it was before Velious was completely released, not classic, effort required, didn't happen for many reasons (yet).
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