Indeed, the fake money accounts aren't reliable for options, as many options have very low liquidity, or a very large spread (SPX). For "hot stock" type of trading, however, I think it would be fine.
I define gambling as anything you put money into, which has a negative expected return. Is it your assertion that since you know a few people, who over a specific time period have profited from stock trading, that overall it does not have a negative expected return?
Note, I should have clarified a bit. I'm not sure if it's actually a "negative" expected return, as in "you will lose money" but it definitely is negative when compared to indexing. There's a lot of data showing that, but I'm not aware of any data showing the return is negative in real dollars.