I liked the Op care in trying to justify every coercive measure, but:
He is admitting that recalcitrant criminals would have to be locked up.
Court sentences (of reparation or imprisonment) would have to be enforced.
It would have to exist a repressive system of courts, police enforcers and prisons. I don't see much difference, beside the endorsement of proposals of privatization of those systems and making people pay for security and justice when they needed them, like the ones from Nozick, with the goal of abolishing taxes.
Besides, if the criminal didn't have money to pay for his judgement and incarceration (most don't), the system would work at a deficit or we would end at a system of vendetta, with all their escalating consequences and abusive self-decisions on the merits of our own cause (we excel at that). That is precisely the system it took thousand of years to overcome. In archaic roman times, the creditor could lock up the debtor on his own private jail until he or his family paid the debt.
Or it would be necessary to support this repressive system on taxes and have him controlled by the community and we would end up just where we are