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the government would step in as it must prevent monopolistic market behavior to ensure fair market competition

The government rarely actually steps in, even in cases of demonstrable monopolies. This is very easy to see in our world today, and will always be the case as long as you live in a capitalist system. Capitalism grants power to the capital holders by allowing them to buy the means of productions, restricting the power of workers to mobilize against corporate action, elect representatives not favorable to capital owners, etc. It causes anti-monopolistic tendencies to waver, because in a system built on being able to buy up businesses, capital concentration is the design, not just an unintended side effect.

if the nazis were a majority of the populace, I fear the argument is moot as they likely would be the ones creating the laws in the first place

A group of people do not need to be the majority of the population to hold drastically more wealth, and thus a direct ability to impact the choices of businesses. See: the top 1% of wealth holders owning 30% of wealth, and the bottom 50% of wealth holders owning just a few percentage points.

Critically though, we need to look at the possibility of such a drastically negative outcome occurring in both of our possible systems. In mine, Nazism simply is not given a chance from the start. It is not given the opportunity to even attempt a power grab, because those who publicly spread the ideology are imprisoned.

In yours, they are given the ability to spread their ideology, still get employment and buy goods at sympathetic businesses, can gain functional societal acceptance by accumulating wealth, and so on. Your system does less to stop Nazi ideology from spreading than mine does. It is fundamentally less hostile to Nazis.

Now, I'm going to try consolidating my responses to all your other replies in this one comment, since I want to try and keep this tidy.

I think this begs the question — is it certain that social intolerance wont prevent, or is likely to not prevent these ideologies from accelerating in adoption?

They can do so, but they are less effective. We as a society, generally, hold distaste for people who do murders. If we lived in a society where nobody was ever imprisoned for murder, would we see less murder? Of course not, because the only consequence to doing so would be social shunning, but you would still be free to do whatever else you please in your life, and if you're a person that doesn't care what people think of you, or can surround yourself in a community of like-minded murderers, then social shunning does nothing to disincentivize you from murdering more people. Imprisonment exists for a reason, that being it is more effective than other means of preventing behavior, such as social shunning.

The exact same logic applies to Nazism. The ideology, after spreading far enough and gaining power, inevitably leads to outcomes that most of us would find highly undesirable, such as the genocide of entire groups of individuals, and thus should be treated as such, with the strongest force possible to reduce the chance of it spreading by as much as possible.

I don’t agree that this is necessarily true. For example, what of the case of a tyrannical government? Society may be accepting of a behavior, yet the behavior may be an imprisonable offense. Therefore something being an imprisonable offense doesn’t necessitate that it be a socially shunned behavior (by the majority).

Sorry if I was unclear by what I meant here. I meant specifically that imprisonment isolates you from the rest of society, by locking you up either in a cell block with very few other people to communicate with (relatively speaking) or by putting you in solitary, with no people to communicate with. You objectively have less ability to interact with other human beings, and have been "shunned" as a result. Or at least, you experience similar effects. (Social deprivation, being placed in situations only involving other people rejected from the common populace, etc) Again, apologies if I was unclear.

It may depend on what you mean by “beneficial”, but, generally, I’m not necessarily arguing that not imprisoning those espousing nazi-rhetoric would be more “positive” than the alternative, I simply fear the risks of going the route of governmental force outweigh the benefits. I fear tyrannical overreach, and I think a liberal approach, while not perfect, may be the best means to stave off this outcome. But, at least we have experiments like Australia, which can be examined from a distance.

Philosophically, the question becomes rather uncomfortable for me to answer; I personally don’t feel that I can be certain that my views are moral, so I tend to prefer the option that ensures the largest amount of ideological freedom. I understand that the paradox of tolerance is a threat to that idea, and it should be resisted, but I’m simply not convinced that imprisonment is the best antidote.

I understand this point a lot, and I do think it's a quite justified opinion to have. If we can't be certain our views are moral, we want to do what requires the least harm to come to people, in case we're wrong.

This

I fear tyrannical overreach

is a good fear to have, but if this logic was applied consistently, then we wouldn't imprison anybody, for any offense, because we can't actually be 100% confident that we were making the right choice in imprisoning them. As I mentioned earlier, we already know what Nazi ideology leads to in the end, we've seen its effects before, and with the rise of fascism in America with Trump's second term, we're seeing it begin again.

Just like how we could observe that murder negatively impacts the wellbeing of local communities, and societies as a whole, we can observe that what tends to arise from Nazi rhetoric also produces those same outcomes. For instance, Trump's new executive orders are doing things like cutting billions in aid that currently keep many people alive in struggling countries, who are now likely to die from a lack of aid. His policies will be resulting in a significant shortfall in spending on critical programs people need to stay alive, like Medicare/Medicaid, are cutting funding for research that develops critical cures for people's health problems, he's actively stripping policies that level the playing field for disadvantaged groups which will only result in their overall relative share of wealth going down over time, not to mention his billionaire supporting policy that's actively funneling more of the few percentage points of wealth everyone not in the top 50% of people has to the top 1%, which will only make their lives harder.

We see the outcomes, more concrete moral biases we can often feel more confident in (e.g. less death is usually ideal, people should ideally be healthy and happy, etc) back up why those outcomes are wrong, so we can then feel confident in saying the thing that caused those outcomes should be legislated against.

If you believe Nazis are a harm to society, and we have all our concrete understanding of their misdeeds to back that up, then it is no different from any action we take against any other bad action to say that they should be imprisoned for the harm we know they do to society.

I understand it's difficult to support something that you could end up being wrong on, that ends up overreaching, but if you do nothing more than the social shunning that already happened just recently right up through when Trump entered the Oval Office, then you get fascism, and we're seeing, yet again, the harm that fascism causes.