It may be an alte minhag but it’s by no means an uncontroversial one halachically. Also, why is the issue of neveilos caused by a shochet who hurriedly shechts a bunch of chickens without checking his knife not a real issue halachically that should override the minhag kadosh of kapparos? Ditto with tzaar baalei chaim and treifos caused by chicken mishandling. Finally, reselling the same chickens to different people is geneivah, pure and simple.
If you want to see real health code violations, go to Chinatown any day of the week. If you want to see halacha violations, many kapparos centers are “begematria cheit”.