Because your statement about "either it's 'market making' or 'trading' I think it should never be the same thing under one roof" is like saying "it either gotta be 'playing soccer' or 'kicking the ball', they should not be the same".

Sure, "kicking the ball" is done by many different sports and in many different ways, but it is literally an integral part of playing soccer, so you cannot say "either or" here. The same.

The whole point of market making is trading securities at both ask prices and sell prices, thus providing liquidity to the markets. So they essentially are making profit off bid-ask spread, but doing so reduces bid-ask spread and decreases market inefficiency (thus converging on a more accurate value of the security in question).

And to your point about regulation of market makers, they already have more than just a "fair bit of regulation and transparency".