Now why would you say that there is no business advantage with having a large holding? Bitcoin is anonymous. There is no certain way determine the total holdings of an entity. The best you can do is addresses.
There is no clear relationship between your question and the series of statements which follow it. I will have to guess at your meaning.
How can you distinguish between an entity holding 10000 addresses with 1 BTC or 1 address with 10000 BTC?
Because the mining power of the stake would be linearly proportional to the amount of the BTC held. It is irrelevant if the entity holds 10000 address with 1 BTC or 1 address with 10000 BTC. His mining power, just like his spending power, is the same in either case. Therefore, large scale investors experience the same rate of return as small investors.
A. any asset of wealth tends to be distributed exponentially among participants.
B. The majority of coins will be in the hands of a few.
A is true, but B does not follow from A.
The problem is that you promote miners to investors by design. However, miners and investors have different agendas (unless a miner CHOOSES to be an investor). It's difficult to predict the repercussions of forcing them to be the same entity.
Okay, so you believe that there are two groups of people, whom you call "miners" and "investors", and who behave differently. There is no economic reason why "miners'" and "investors'" behavior should differ, but you expect it to. This is silly, but it is not possible to provide a counterargument.
I find that typical of discussions here. People generally lack a coherent, logical explanation for their beliefs and it is not possible to constructively argue with them. Consider this argument closed (at least on my side).