If you are going to block ads, block them. Don't click on them.
Also, if these developers really wanted to, they could distribute it directly from their site and dynamically generate the extension, packaged with a unique identifier, for each download. This would make it effectively unblockable. So simply identifying an install of this specific extension is not a solution.
Yes, the large networks occasionally serve dangerous ads. But by far and large, they have better standards then most of the fly-by-night ad networks.
There's a reason why everybody uses ad networks.
I’m not sure why you think this is so complicated or impossible.
Actually, Google does track all of this stuff already:
http://adage.com/article/digital/inside-google-s-secret-war-...
Google could decide to just ignore IPs that host users that display this behavior pattern. But yeah, it's "easier" to just ban the offending Chrome extension.
If Google wants to wholesale block all IPs that cause them a problem with click fraud that's their prerogative, but manipulating the electrons that very safely reside within my own private property and then turning around and continuing to serve me ads is something straight out of a Dickens novel and I shudder to think of what happens after the second chapter.