The only way to empty an SBD is to sell it on either the internal or an external exchange

This is not correct. There is a blockchain function which 'converts' SBD into STEEM, essentially emptying the container.

That is the main vehicle by which SBD is pegged to be worth at least a dollar. On the other side, pegging it to not be worth more than a dollar is currently done via dilution, by printing more of it.

Both mechanisms are imperfect but they do work to a large extent.

There is really no such thing as a 'natural price' for SBD. Any market price is a 'natural price' in the sense that buyers and sellers agreed to exchange at that price. The software which implements SBD, and which was created by humans with a particular intent in mind, certainly can affect such a market price. That software was not necessarily ideal or perfect, and it can be (and have been), like any other software, improved via updates.

Or we peg it to $8.00, seeing as it seemed to sit around that price for some time.

This is just silly. The actual peg price is an arbitrary number. If we decided to 'peg' it to $8, then the blockchain would issue 1/8 as much of it when it generates STEEM rewards, and the exact same market dynamics that pumped it to $10 would pump it to $80. There is no difference. You can't change the structure by changing the number. (To be perfectly precise here, perhaps it would indeed make some small psychological difference to peg at a different number. My brain struggles to understand the psychological impact of calling something a Steem Dollar and pegging it to $8.)

I honestly don't know what sort of fetish leads people to believe that one particular implementation of software is clearly the best and can't be improved. Do you want to go back to using Microsoft Word version 1.0, too?

The other thing is, blaming the witnesses for the decline in SBD price is really kind of silly. It took witnesses a while to each reach some sort of agreement on what to do and by that time SBD had already declined quite a bit, maybe to $3-5 (I don't recall exactly). Given the state of the crypto market over the past year, expecting a continued or renewed SBD 'pump' even without any sort of changes is pretty far out there. In fact, several witnesses were explicltly unwilling to act, until after the SBD price had already come down closer (if not all the way) to $1, specifically to avoid being involved with directly manipulating the market. (Here is a comment thread from January where I said that was my own preference, and I was not at all alone.) In the end, that is exactly what we ended up doing. SBD briefly dropped all the way to $1 in mid June and then again in early July. It didn't ever go back above $1.50. The code change implementing the looser print rules was merged July 20. (Of course HF20 didn't actually activate until months later.)

The temporary SBD pump up to $10 and beyond was largely an anomaly based on the overall crypto market (and just about everything in it) pumping like crazy for a while. It pointed to some weaknesses in the SBD software, but the SBD software didn't create the pump and the improvements to the SBD software almost certainly didn't play a huge role in deflating it either.

You just don't seem to get that SBD is NOT 'just another crypto' in the sense that most cryptos have a certain predetermined supply schedule that does not depend on external factors like the price. Price in that case is purely left to be determined by supply and demand around that fixed supply schedule. For example, Bitcoin has 21m units, with half created every four years. EOS has a billion units, with new ones created at some low inflation rate. Steem is similar to EOS, etc.

SBD doesn't work that way, and never has. It is created and destroyed in a dynamic manner, based on the the price. So price is both an input and an output, just not an output. People trading it (the "poor souls who did not know that" as you put it) have an ethical obligation to understand what the hell they are trading or suffer the consequences. They can't just assume that SBD is like Bitcoin or EOS with a fixed supply schedule and hope for the best. Or, technically they can (and perhaps did), but they are blindly gambling.