I think cheating might be a strong word for it, although it does seem borderline. I would definitely class any attempt to make your armband less visible as unsporting to say the least, to your own team and the opposition. Nobody wants to be that guy who lights up the friendly sniper who snuck into such a good position he's intermingled with the opposition, and that hesitation after spotting them can easily see you out of the game instead. Which to me feels unfair, if we came across a non-ghillie player wearing the band under their kit, we would call that out immediately, but for some reason some ghillie guys seem to think they're above the rules, everyone else, and fair play.
SOME ghillie guys, but that mentality, almost like they're the protagonist, and everyone else are NPCs whos experience is irrelevant, does seem to be more prevalent among our scrim wearing brethren.