Malicious Model and Arbitrary selecting inputs on MPC and PSI
In general, such attacks are "allowed" in the malicious model. This is due to the fact that secure computation guarantees that the process of computation reveals nothing. A secure protocol should behave like an ideal model where a trusted party computes the result. Now, in some cases, this is a problem. However, in practice, in many cases it is OK.

Consider the case of PSI: in practice, the length of the inputs is known to both parties. Thus, it may not be possible for one party to input the entire universe (which may also be huge). Having said this, this is possible if a protocol is used that depends on the entire universe (e.g., PSI by running secure computation via a circuit that computes over vectors of bits, so that the $i$th bit of a party's vector equals 1 if and only if it has the $i$th element of the universe in its input). Formally, the definition of the functionality should express the size of the input and therefore make this clear. However, in reality, this detail is often overlooked in papers.

In short, this is a real issue and if you want to use MPC you need to understand the ramification of "maliciously chosen inputs".