Of course, this all breaks down when you have a cartel :) I recall in one of the major prisoners dilemma tournaments, the winning entry was actually a coalition of users who would use the first few moves to establish a code for membership in the cartel, and then one entry was the master while the others were slaves. The slaves always cooperated and the master always defected, to their victory.
Indeed, the major weakness of the linked piece is that it doesn't account for any kind of social structure or any class behaviour. Which, in my book, makes it fairly worthless as an analysis of actual social behaviour.
Not worthless. This has some clear assumptions on what holds. He looks at individuals playing a certain game, with no outside information. What the parent describes is two games: 1. Prisoners dilemma between each "slave" and the "master" 2. The actual tournament