So like, if you want to write Feel Good Violence but want to avoid all the problems mentioned, you should have it be in-‘verse fictional? Like, a character’s daydream or fantasy.
Not really. When you have a character indulging in a daydream, that’s not the same as a character who gets up and actually assaults someone. There is a real place in a story for characters to engage in fantasy escapism, but doesn’t take the place of actual violence, and wouldn’t have the same consequences.
When you have a character who sits there fantasizing about all the things they’d do to someone, if they could, you’re drawing attention their inability to act. That may be simply because they can’t act openly, or it could be that they’re actually incapable of taking action.
Depending on your character arc, that can be a useful thing to show. A character who goes from powerless to empowered may begin their story fantasizing about the things they’d do if given the opportunity. Depending on if they’re the protagonist or the villain, you may even contrast this or replay it to more horrific effect, in the real world later. It’s also possible your character would attempt to enact their fantasy, only to be slapped down hard
Also worth remembering, indulging in violent fantasies is not really what you’d call socially acceptable. If anyone finds out what your character’s been dreaming about, it’s entirely reasonable that this would stick a monkey wrench in their life.
Intentionally, or otherwise, daydreams like this can provide important insight into how your character views the world. If they’re dreaming about all the horrific things they’d do to people who’d wronged them, that’s not a flattering image. It’s also setting the bar much higher when they try to come back from that.
Alternately, it can underline how disconnected your character is from reality. Someone who frequently engages in violent daydreams could have a tenuous grasp on reality, and be on the edge of completely spiraling out of control.
Dreams (of any variety) can be an important window into a character’s fears, desires, and inner psyche. However, they’ve been heavily overused, simply because they’re a useful tool, and as a result, it’s difficult to use them without being cliche. This doesn’t mean you should completely ignore the idea, but dreams (and daydreams) should be used very sparingly, only when you really need them. If you want to express a character’s inner frustration boiling dangerously close to the surface, you can cull the sequence down to a couple lines, describing what they’d like to do, without indulging in a full scene.
So, no, it doesn’t sidestep the problems inherent in consequence free violence, it’s an entirely distinct tool with it’s own uses.