I often agree with your positions on various things, Phil, at least to the extent that it seems that we’re operating from a similar point of reference. That said, and in light of the nature of the private communications remaining private (as it should), there’s only one conclusion that seems fitting.
PTB.
One instance of anything hardly seems like grounds for a ban. Repeat behavior certainly could justify that action, but in the absence of any pattern it seems like an overreach. There might well be further justification for a ban based on the direct messages; but, as you’re submitting your own action for analysis, the only fair way to evaluate is on the grounds of what we are directly privy to. Anything else has to be viewed as simply your biased interpretation of the private conversation.
In the circumstance you describe the onus on the user is not to be “receptive or apologetic” to you in the private conversation, only to correct their usage of the report system. As presented, it reads as if they were banned because they did not show adequate respect for your authority, which is clear PTBehavior. Further, you attempt to bolster your point by painting Squid, a user who loves to try to win bad-take arguments by referring to their own mod status in other communities (essentially a PTB themselves), as undeserving of ire despite an extensive history of spinning out, losing the thread, and generally being a dick when it happens. Carrying water for someone who comes across as power-trippy does little to shift perception of your own actions away from that mark.
PTB. AFAIK, RTFM N/A. NGL, NIMBY! YMMV, TTYL.