I pointed out that your argument doesn't contradict Locas's statement that those who don't enjoy the work will be forced to do it, and specifically disclaimed that choosing to do the work regardless might well be rational of them (and hence making them better off). Yet in reply you elaborate in what manner this decision can be rational, as if objecting to what I said. I don't see what you disagree with (besides usage of the word "forced").

Also:

But in a world with house elves, they are even worse off - they are just unemployed, rather than having the option of taking the job.

They are not unemployed, they choose the next best option available.