Increasing bandwidth for better players makes their connection to the server faster with less traffic, it doesn\'t mean that it will free up space to allow more people. By having one less player on the server (the cheater), the bandwidth used for that player will automatically be dispersed among the players currently connected, making all of their connections slightly better.
As far as I know, there will be about 2 servers. One for playing, one for testing, but I could be wrong.