Yes, it should be banned. It shouldn't have been made legal in the 1st place IMO.
The pillowed v-cube was the only 7x7 available for some time.
Here is my point with banning pillowed 7x7's compared to banning stickerless cubes in BLD:
First thing is that stickerless cubes are banned in normal solving because of obvious cheating capabilities. Stickerless cubes where still allowed in BLD because that particular "advantage" did not apply to BLD solving. I do see the advantage of memo-ing a stickerless cube however 4 out of 5 serious BLD solvers use stickerless because they don't have to change these stickers. Having the colored plastic gives a slight advantage to memo-ing but not greatly. I do however believe that there was no need for the ban; however I understand why the ban was put into place. As compared to the pillowed v7 you have a different advantage; you can slightly see the stickers better. I feel that this is not great enough or important enough to completely ban the first 7x7 available. Think of the immediate consequences of banning it:
1. You know that Verdes (v-cube owner) will throw a fit and sue Shengshou (he has a very big temper)
2. Shengshou is the only cubic 7x7, therefore creating a cubing monopoly. (which are illegal in the US

)
3. This would cause a
huge decrease in 7x7 competitors.
4. This would anger many people
Just to name the big ones
This pillowed v-cube was the first 7x7. It was revolutionary with its pillowed design, Verdes figured out a way to make a 7x7 with it being structurally sound. Banning the v7 is like banning a Rubik’s 4x4 because it has a different mechanism.
That is all the pillow is a revolutionary mechanism
Just think about the consequences of banning the pillowed v7 before you do.
-Ducttapecuber