Seems engagement is largely a function of VP and willingness to upvote comments, as many opportunistic commenters seem to flock to these accounts. Any type of algoritmic rewarding/voting is bound to fail unless true manual curration is factored in as the primary variable. A secondary variable that I think is usefull is the non-usage of bidbots. Aggressive bid bot users are usually easy to identify. They have high reputations that truly don't match their VP status. I would suggest some sort of reward correction based on the VP to raw-reputation ratio.
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You're spot on that there's no substitute for manual curation. That said, our goal here is to do the best we can with an algorithm, and I'm sure we can do a lot better than what currently exists.