This reminds me a bit of the common argument for locks: it keeps regular people honest. Watermarks are designed really to deter you from casually copying an image and pasting it on your site, unless you don't care at all about a watermark showing (e.g. a blog site with a few followers). I'm sure a mixture of the original computer vision technique plus some smearing on the original image could wash away even these ran…
Same can be applied to locks on a house. Prevents someone looking to have fun, from just walking into your home. Otherwise it's too much effort.
Regarding reporting. I've submitted various copyright claims to Instagram for others using my photography, and they responded quickly. It was a smooth transaction.