However, it is furthermore true of iterated PD that there are multiple different Pareto-optimal equilibria, which benefit different players more or less. Also, if players don’t successfully coordinate on one of these equilibria, they can end up in a worse overall state (such as mutual defection forever, due to playing grim-trigger strategies with mutually incompatible demands). This makes iterated PD resemble Battle of the Sexes.
I think this paragraph very clearly summarizes your argument. You might consider including it as a TL;DR at the beginning.
I think this paragraph very clearly summarizes your argument. You might consider including it as a TL;DR at the beginning.