I believe if the issue were to come up before a court and be properly presented, Amway would in fact be considered a pyramid scheme. I also question your assertion that in MLM "many more people share in the profits."
Do I think our governemnt should outlaw it? I don't really, but to me, it is a pyramid scheme. A pyramid scheme is profitable by new persons paying for memberships. In AMWAY they hide this element behind payments over time, in the form of overpaying for items purchased. A $5.00 trip the grocery store is a $25 expense with Amway. Sure, you get really good toothpaste, but you should be for what you are paying. And then you ask yourself, if this expensive stuff were for sale, would I buy it at a regular store? Would anyone? And hte answer there is no.
They do make great vitamins, which I believe in.