Spoiler
There are plenty of reasons to fear it might be alive, first that it is found mostly in both the head parts and body parts of the same pony, which doesn't mean it spread between parts as both parts were exposed to the same conditions, and both parts are often made of the same batch of the same material, and it is sometimes in just the head or just the body so...that's inconclusive. The growth (or "development") pattern is why I suspect it of being alive....almost perfectly circular unless there is a reason to not be circular, just like cultured colonies on agar...and the theory that you can kill anything living by boiling is flawed too, because the original form of life on this planet, which still survives at the continental ridge volcanoes on the ocean floor, are bacteria that thrive on temperatures even higher than boiling water on the surface.
I had a terribly afflicted Moonstone, and needed to know more. She was in terrible condition overall, by the way, and came from a group of ponies that had obviously been stored in heavily rat-infested and damp storage conditions for a long long time (figured the eBay photos were bad, but nope...). After doing everything I could think of I decideto have a little dissection and I cut into the cancer and found that it is in fact in the center of the material, furthest from the inner and outer surfaces. The lighter brown is actually seeing the darker spot through the material, and where the dark has reached the surface is the darker brown. When you cut through the lighter brown areas at an angle (like shaving into the material) you can actually see the edge of the different colors, looks like a tree ring actually.
Next I bought a Bright Eyes at a good price in a small lot and thought I got a great deal on her until I discovered she has a spot on her forehead, and went back and saw it had been described and I didn't read carefully. At first I didn't care for her much but figured I didn't want to lose a valuable pony without trying, so having heard that boiling "kills" the cancer I gave it a shot. I was astounded when the spot disappeared! leaving an off-white circle in her otherwise blue color. I didn't care much for her dull plastic eyes so I put in Zirconias instead and really love her but...after almost a full year, that offwhite spot has darkened and then weeks later I can now see a darker spot forming in the center. During the time I thought she was "cured", I experimented on a much more afflicted Fire Chief and I boiled him for days, and while the spots did fade to white, I also observed before and after with back-lighting and deep down, the spots are still there. Oh yes he darkened too, but refreshed to bright white in peroxide sunfade and it seems a dry sunfade might have worked almost as fast.
Bright Eyes also had a touch of cancer at her neckline, in an odd shape that followed a hair (seemed like a non-real hair probably a pony hair, probably one of her own, or some other fiber: it was reddish so had some colorant in it) that was trapped in the neck seam. Before boiling her, I cut that spot away and sanded her smooth there and that area remains clear so far.
None of this establishes whether it is alive or chemical, but one thing is absolutely clear: it takes a long time to develop or change so it is very hard to study and the only way to really learn anything conclusive about it requires carefully controlled scientific experiments with control groups, controlled conditions, and observation over a period of years. And the right questions must be asked and the right conditions must be varied and the bottom line is, no one with credentials qualified to publish results we can all conclusively rely on is going to do it. I intend to continue my experiments, with a new round this time including Gingerbread and a control group pony but will still fall short of the standards of "science" and will basically be meaningless aside from anecdotal value.
I don't think anyone has reported an "outbreak" across their collection caused by owning a few afflicted ponies. Even if it is contagious, its spread seems to be contained within one pony so at worst, it's not going to spread to something it isn't pressed closely in direct contact with for a long time.
I will probably re-boil my afflicted Bright Eyes and continue to love her, and continue to love my afflicted Gingerbreads especially the first one because she was donated to me for cancer study by a very generous arena member and I'm only holding off on her treatment because I want to understand why Gingerbread darkens in the sun rather than whitens so I can be sure I can have the best chances of returning her to "service" of being enjoyed on display and handled, not sacrifice her. In fact, I didn't sacrifice the Moonstone I dissected either: she has a paper-thin amount of remaining material where I carved her spots away and is still boxed up in my pony archive and I'm not throwing her out or painting her over or anything else.
When I do a "custom", which I haven't done very many of (so far I've only done 1 from a G4 and finished up a couple of inherited other people's projects already started), I don't paint over the entire pony until I learn how to fuse the paint to the pony like the original eye and symbol paint. Paint that just sits on the surface has a ticking time limit as the plasticizer leaches out and eventually must separate the paint. I know the eye and symbol paint doesn't do this and maybe someone else has managed to learn what paint and how to use it to make the paint last over the long term. Until I understand this, I'm not painting over any ponies because if I can't scrub it with a toothbrush and cleanser, it's not a pony (to me). While we collect them, they are first and foremost toys, which must withstand play and be washable and be at least as loved as they were played with. I also like my ponies to have played-with evidence: pen marks of kid's initials on the bottoms of the hooves are fine. Makeup by marker is OK too. Haircuts are all right, though I don't care about original hair and actually like alt rehairs especially. These are all just reasons to have that many more of each pony because each of them are unique and worthy of having alongside the same pony that is different in some way.