Because the GM *is* responsible for how players interact with the rules. The GM has recognized the issue, and put a solution in place to even out the rules issue. So, why is it then the player's job to unilaterally throw that solution out?
Bear in mind, I agree with using diplomacy and having a thought to the extra ramifications if the OP confronts the cheater (like irritating the GM).
However, it's also not just a matter of jobs. Just because the GM chose how HE would react to the situation doesn't grant him authority over how I get to react to the situation. In fact, given that the GM decided what action he was going to take and NOT discussing it with the group is also unilateral decision making.
the GM is the arbiter of the rules, not social disfunction resolution. Cheating in an RPG tends to cause a social problem more than a mechanical one.
I'm no expert at solving the diplomacy problem, but I can smell that it is needed. There's a lot of conflicting social mechanics at work here:
cheating is wrong
talking about someone behind their back is wrong
causing a ruckus in a confrontation is wrong
not doing anything when there is a problem is wrong
not involving the group in a solution when there's a problem is wrong
The GM gets all the rope to solve these problems, when it's not really their job or skillset to wrangle adults into behaving correctly.
I'm wondering if each group needs a table-rule on how to deal with bad behavior at the table. For instance, report suspected behavior problem to GM (he's the common authority figure), and GM brings up the issue in front of the group in a post-game group discussion. At least in this way, everybody knows about the problem, so it's not 4 different conversations about you-know-who going on. And the group is involved in making the decision not just one dude, behind everybody's back.