I think having a deflationary supply would be nice to consider, but I’d wanna explore the subject in more detail (from a monetary stand-point) before voicing a pro/con opinion on it. Interestingly, someone brought up the opposite idea - that of an inflationary supply - and articulated it really well (see Robert’s post here). I suggest we create a separate topic for the discussion about this.
Regarding the gauge - it would be ideal to have all the rewards collected in one place and accessible whenever users desire. Withdrawal/conversion/buyback of $SWISE with $BAL could be automated using the vault. The only thing that’s still unclear is whether $BAL could be collected into the same gauge as $SWISE and rETH2 - that’s for us to clarify with the Balancer team.
On the topic of LP token usage - I think you’re reading our thoughts here. We are exploring ways to allow using LP tokens elsewhere (not necessarily CREAM) to improve the capital efficiency for the user. So that an initial deposit of 1 ETH could earn staking rewards, trading fees, $SWISE, $BAL and extra income from the integrations we achieve (in the works: external slashing insurance product and usage as collateral, obviously).