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The part you are missing here is that interchange fees is not the only money maker. At least equally important, maybe more important, money are in people that over-consume credit, and pay absolutely humongous credit rates. You need to lure in those people, and abuse them to the max. Adding gambling addiction component fits very well - this is exactly the sort of people that tend to overconsume their credit in the hope of one day winning big. And unlike traditional gambling industry, which is by now pretty heavily regulated, you can put in whatever technology with whatever winning chances and algorithms optimized for maximum addictiveness, at least until the regulators catch up. That's the whole point - it's not targeted for regular "get my 2% and pay off the card each month" consumers. It's exploitative from the ground up.
That part I am not sure I understand. I mean, marketing expenses, sure. But otherwise, it's just bits in some config files somewhere in the existing systems. Why is it expensive? It's a mass industry by now, everybody has their own CC brand.
Sure, a traditional bank probably won't want to be associated with a gambling business. But somebody runs all those gambling businesses, and they have money too. A lot of money, probably, so convincing them to invest into yet another way to exploit gamblers wouldn't be impossible.
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