I had to submit pictures of my product keys, which seemed to resolve the issue relatively quickly. If I had bought all my games through Steam though the process is reportedly much more of a hassle and takes longer. Also there are some things they ban you permanently for, as you hint at. Doing a chargeback on your credit card purchase for instance results in you losing your account forever, even if Steam really did make a mistake and charge you inappropriately.
Well in the case of both of the guys I'm talking about, they had already amassed tons of legit purchases without a problem. Other than the annoyance factor associated with the client. One of them typo'd the expiration date on his card, the purchase still went through, but then Steam or the bank realized it was wrong and canceled it. The other one was due to some weird error with the bank transaction system and it bounced.
Both of them were not told the cause of the problem. They were just summarily banned from the service. They both called in and tried to get it resolved peacefully and were both essentially told they were thieves and no longer welcome. Oh, and both were told they weren't getting refunds for anything they bought.
It was only AFTER all this happened that they took my advice and called their CC companies to get them to issue chargebacks on the basis of fraudulent refusal of services. Both of them were quite surprised to find that the banks were not only willing to chargeback the transactions that caused the trouble to begin with, but they charged back ALL of the purchases and logged them all as fraudulent denials of access to purchased goods. I bet Valve wasn't the least bit happy about it, but screw them. They got what they had coming to them.