In my case there is really no material damage done, only frustration: after all, I have been giving the files away for free. I’m just annoyed that others are selling my design, additionally using my copyrighted photos.
As for Etsy, I do realize that the majority of people selling there are honest sellers. But while my wording might sound strong, I thought about this several times: Etsy makes money on being a middleman. They should not be able to just ignore intellectual property theft, pretending they have nothing to do with it, while actually making a profit off trading of stolen property. Something here is wrong.
I think the form @Gerry mentioned appeared within the last year or two, I don’t recall being able to do this when I last tried to contact them. But consider: I need go through this (rather detailed and painful) procedure for every seller. And then, even if all this does succeed, all this does is remove those particular listings. The files will come back again, as they already have.
In a more constructive spirit, what I would expect is an easy-to-use “report this listing” button. This would get referred to human moderators who after contacting me once would have all the details (the files, copyrighted photos, proof etc), after which I could click “report this” multiple times and it would go through quickly (as the moderators would have “preapproved” data from me already), without dragging me through a long procedure every time. But this would cost Etsy money, which they are not willing to spend. Hence my “ethically dubious” conclusion.