You know, at the very least it would be nice to get something a bit more direct, like, "We are no longer permitting extensions that do X on our marketplace", or heck, even just a "We're permanently rejecting this for unspecified reasons."

But if that's what you're doing, don't claim that the extension is being rejected for "overbroad permissions". I understand that Google may not literally come out and say "We've decided to eat your extension's functionality and you can just burn." But don't lie about why it's being rejected... however much you may wrap the result up in marketingspeak, don't actively lie about the reason for rejection, so that someone can burn the candle at both end for two weeks futilely trying to appease the lying error message.

As for the fact it may not look that great no matter how much marketing-speak it gets wrapped up in for Google to just eat some functionality and kill all competition... yeah, well, suck it up Google. Don't lie about it. I mean, you can always spin it as security security blah blah security if nothing else, which ought to be enough of a fig leaf.

Outright admitting this may cause issues with antitrust laws.

Neither here nor there but it was "Don't be evil", never "Do no evil". The latter evokes the Hippocratic Oath and sounds virtuous, but the former is a somewhat tongue-in-cheek reference to the (at the time) megacorps they wanted Google to not be like.

(Mind, they're arguably not complying with the "Don't be evil" version either, especially lately.)