I wouldn't call what you've written a straw-man argument, but neither is it a steel-man...
My biggest takeaway, and an entirely legitimate criticism, is that if all your functions become instead State World (), your type signature no longer gives you much information about what the function does. In light of this I intend, when/if I get around to playing with a game in Haskell (or anything else that involves shipping around a huge wad of state), to look into splitting types of game state changes into multiple typeclasses, so as to see about preserving some more information about what various state transformations touch (both reading and writing)...
My biggest takeaway, and an entirely legitimate criticism, is that if all your functions become instead State World (), your type signature no longer gives you much information about what the function does. In light of this I intend, when/if I get around to playing with a game in Haskell (or anything else that involves shipping around a huge wad of state), to look into splitting types of game state changes into multiple typeclasses, so as to see about preserving some more information about what various state transformations touch (both reading and writing)...