Fee height vs. TX value - limit? Is there a particular reason fees higher than the transaction volume are allowed?

What about imposing this: 

Smallest output must be at least 10 times the fee.

Might reduce Spamdice transactions (thinking of losing bets notification).
But what if you really needed to pay someone a fraction of a transaction fee? Bitcoin is indiscriminatory in that regard.

Moreover, most transactions have two outputs, one crediting whoever you send your transaction to, and one crediting you back. It is quite easy to send the same small amount transactions to someone while still appearing to be sending a large amount of money in total (the remainder would be sent back to you).

Anyone can enforce arbitrarily low or high transaction fees and modify their software to exclude any and all transactions they don't like (for example, I have heard Luke-Jr's pool does not process SatoshiDice's transaction at all). In the end, it is the will of the people and the miners that will determine the correct fees and rules, not some fixed mandate.