Why is competition a good thing? I'm not saying it's not, I'm just checking if you're saying that competition in and of itself is something you want, or if it leads to something.

There are generally two cases - one, someone is at their wall and you can get higher, whether just because or you have more time/patience/desire to grind out a few more levels. In this case, if you do go ahead and don't settle for a tie, what of it? If you want to, you should go ahead - no one's stopping you. Sure, it might suck for someone else and they might make a reddit post about it, but you have no obligation to stay and tie. Two, the roles are reversed. You're at your wall and someone can pass you. In this case, would you want them to get ahead of you, to get less rewards in order for them to be true to the spirit of competition? Is it annoying that they're helping you out?

I personally tie when I can and I know that I can't get a higher rank - by furthering this culture of tying, to no detriment to myself, perhaps I can benefit from it in a future tournament if someone that could pass me chooses not to. Maybe you could call it a long-term strategy, idk. But that's just me, if you like to compete in tournaments that's perfectly understandable - it would certainly help with the monotony of always comfortably prestiging.

Ok, so issues with tying - I agree that the devs just handing out diamonds like that can hurt them, but I'll take what free stuff I can get :P Cutting back on diamonds given out in ties would be reasonable, but I think a lot of people would complain if they cut back on the weapons.

I'm not sure about using time - it would force people to spend the first x hours dashing for their walls, when I think a nice thing about the tournaments currently is the flexibility in how you want to spend your 24 hours (including multiple prestiges).

Splitting sounds interesting, since it does make sense that sole posession of a rank is "better" than sharing that rank - maybe it doesn't have be a 50-50 split, but could be some multiplier, like 60% of that combined pool for each, or whatever.