Of course it all works in theory...
Hypothetically, if it was legally permissible that a private pilot could charge for services rendered; then the PPL would be in-distinguishable from the CPL with regards to the rights and privileges of the holder. So I deduce that the real reason that the CAA impose this restriction is to help keep aviation alive.
Because the purpose of the PPL is to allow someone to fly for their own pleasure, the only importance of the training is that they're able to fly about safely, without too much accuracy. So the minima and skills required for the PPL can be relaxed a bit to make it cheaper and easier to obtain. Thus more people believe that general aviation is feasible and embark upon flying training, buying aeroplanes and generally flying about.
The purpose of the CPL, as I understand it, is to allow someone to fly for business reasons. Commercial traffic seems to take priority over private, because money is involved, and with ATC making demands on commercial pilots to help them expedite their flight, a bit more skill is required than just to be able to fly safely. Hence more training is required, and also more revalidations to prove that the pilot is as good as he thinks he is, etc. More money goes to the flying schools.
Air Operator's Certificates allows the CAA an influx of cash so that they can afford to regulate aviation, plus the requirement for the aircraft to have a Certificate of Airworthiness to give the engineers their bread and butter. The CAA can sting for more cash by insisting upon Class 1 medicals - generating jobs and income for the medical sector, and plus the pilot needs type ratings for the aircraft, etc. Its all to prove that he's qualified, of course. But the CAA must be making a fortune out of all the regulation. A fortune that it couldn't make if PPLs were able to earn a monetry benefit by flying.
Sorry if my post seems a bit rambling. The trouble with hypothetical situations is there's a lot to consider, which makes structured thoughts rather difficult. 