Like you, I'm struggling to see how this is substantially different from proof of work, besides trading one limited resource (GPUs and power) for another (disks). It surely still comes down to real-world money - whoever can afford to buy the most disks can mine the most crypto.

I think the big part is that farming with hard drives is a much more approachable thing to do than to try and mine BTC/ETH, considering both of those at a minimum require crazy GPU hardware, if not full blown custom chips, that no normal people will buy. Also, insane energy usage too, which Chia doesn't really have.

That being said, yes, with the right amount of investment, someone could try and take over the network. That being said, look how many Full Nodes are already in the network...

https://www.chiaexplorer.com/charts/nodes

Not just the most hard drive space, but the very specific fast kinds of hard drives you need to farm it efficiently.

The idea that you can do a sustainable cryptocurrency that remains sustainable no matter how valuable the tokens become in real money terms is self-evidently ridiculous. There's always some limiting resource you'll hit first, and if the cryptotokens are worth real money, that resource will get scarce.

But Chia is a good example of a brilliant person being so seduced by a challenging technical problem that they lose any ability to see foundational problems that people with a tenth of the brampower would be able to spot instantly.