Yes, the fire analogy is accurate when applied to well, fires, what i meant is fire + fire in a "realistic" way cannot be compared to people because we are not fires.
Another reason is that Riot fears that people being stuck in a queue where they get treated the same way they treat others may result into those players that are stubborn enough and not willing to change their behaviour into leaving the game \ stop buying as, they are part of the community and willing or not, they are also part of those that contribute because let's be honest, if you have played this game for more than a year i bet my money that the great majority has at least bought RP once or desired to.
Regarding to your last part, the flamers and toxic are called like that because they can spread, basically what you said, BUT think of it, if you put 2 people that are already flaming and being toxic in a safe place, they will not start a great fire or be more toxic they will cease to exist to some point, or well, be trapped there to eternity if they aren't willing to bend to the right path to take.