You can do the same thing in any system of logic.
In more advanced mathematics you're required to keep track of values you've canceled out; the given equation remains invalid even though the cancelled value has disappeared. The cancellation isn't real; it's a notational convenience which unfortunately is promulgated as a real operation in mathematics classes. All those cancelled-out values are in fact still there. That's (one of) the mistakes performed in the proof you reference.
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A couple of concrete examples on either side of the acceptability boundary would be useful: one where "manipulation" is "Treating other people as pawns in your plan", and another where "manipulation" (now termed as "influence" to avoid negative connotations) is perfectly "fair".
True. However, it's difficult to construct culturally neutral examples that are not obvious. The ones that pop to my mind are the kind of "it's wrong to be nice to an old, really simple-minded lady because that way you can make her rewrite her will to your benefit", or "It's allright to try to make your roommate do the dishes as many times as you possibly can, as long as you're both on equal footing on this "competition" of "who can do the least dishes"".
I'm not sure how helpful that kind of examples are.