I don't really agree with this. If we assume code is law, the reward pool is set up for individuals to reward whatever they want

Yes, but that's why we have both upvotes and downvotes. The reward pool is set up for individuals to reward whatever they want, as long there is agreement on rewarding it. If you want to unilaterally reward whatever you want, the mechanism for that is the transfer function.

Human decision making is not perfect whether individual or otherwise, so we can expect that some stupid and worthless content will be rewarded, but with the need for agreement, the degree of wasted rewards should be somewhat reduced.

I agree with you on engagement, but ultimately this is somewhat of a chicken-and-egg problemaand until you have a very large community, you can't really have engagement on any but the most prominent and common of topics. One of the goals of the reward pool is to use those funds to attract contributors, grow the community, and get to the point where organic engagement can start to be a big draw. It doesn't just happen out of thin air.