The issue with blocked users not being able to undo mistakes has come up before, e.g. in the context of taxon swaps: https://forum.inaturalist.org/t/taxon-swap-results-in-permanent-maverick-ids-when-identifier-is-blocked/55700/
As I noted in that thread, it seems like a problem that clogs up the ID process for everyone – including the blocker – without offering any real benefits. Because for any blocking scenario I can conceive of, the basic motivation to prevent unwanted interactions; if the trigger for blocking is an unwanted interaction (a bad ID), I find it hard to see how withdrawing the source of offense would be perceived as the blocked user continuing to provoke the blocker.
I wonder if it would make sense to make a formal feature request to allow blocked users to withdraw IDs.