What should be done about players demanding to be traded?

While you can't punish someone criminally for violating a contract, you can go after them in civil court and sue for damages. Also you could write into the contract terms that aggrieved the party can enforce on its own.

In the case of the NBA for instance, you can make it so that a player who decides to sit out unless traded has his contract immediately voided (so no more pay) and is banned from the league for life.

 

That depends. If I say that I am retiring in a year but still show up and do my job no differently until leaving, then sure.

But if I am already mentally checked out and stopped doing my job well then that is certainly in bad faith. Kawhi Leonard did that by literally not showing up to work and certainly AD could do similarly if he isn't traded.