Why does the Wizarding World have a binary perspective on Muggle interactions?

Question

As I get older, the more I struggle to understand the Wizarding World's relationship to muggles. The Wizarding World seems to have two chief perspectives on how to interact with muggles.

1. Go to extreme lengths to hide the existence of wizards from muggles, in hopes to protect wizard and muggle alike.
2. Reveal wizarding existence to muggles, and dominate over muggles.

I understand there exists historical reasoning behind both of these perspectives, but what strikes me is their extremely binary nature. From my perspective, there seems to be a clear middle ground that is left out of the discussion...

Reveal wizarding existence to muggles, and attempt peaceful coexistence with one another.

To be clear, I am not arguing that this position would work out (though it may), but the lack of advocacy is bizarre IMO. Particularly because it is easy to imagine that witches and wizards with ties to the muggle world (and many without) would feel a moral imperative to use their talents for the betterment of the world as a whole.

Surely a witch like Hermione would have feelings about the fact that she could fix dental fillings in seconds by uttering the word "repairo", and it took her parents years of schooling to do the same in a two-hour torture session?

Dentistry jokes aside, the use of magic outside the magical world would have profound implications. Human conflict, famine, climate change, crime, medical suffering, economics...

To be fair, I do feel like the separation of wizarding and muggle worlds helps make the story immersive, but I do wish there was more explanation as to why these two positions dominate wizarding culture.

Is there something in canon I am missing?

Answer 1

To start, you don't sound to be missing any canon that I'm aware of. I've read and watched the series numerous times. Two of the reasons Rowling has her characters state for the separation of the worlds could also explain the two stances toward muggles.

1. "In Harry Potter and the Prisoner of Azkaban, Harry writes an essay on medieval witch burning, which was cited as the reason behind the introduction of the International Statute of Wizarding Secrecy, and wizards going into hiding from the Muggle world."

2. "A great deal of effort is expended in keeping the Muggles unaware of magic. Originally the two worlds co-existed; however, persecution of those with magic meant laws have been put in place over the centuries, designed to keep the existence of the magical world hidden from Muggles. The first and most important statute is the International Statute of Wizarding Secrecy of 1692. Enchantment of Muggle artefacts is forbidden; underage wizards are restricted from using magic outside the school, and any deliberate revelation of magical ability to the Muggle community is punishable."

These are both from Wikipedia and are derived from the books.

The way that the two worlds have developed parallel to one another has only served to reinforce either A. the wizarding world's parent-like, mild derision toward the muggles, or B. the wizarding world's resentment toward having to remain hidden from an arguably inferior side of humanity.

However, there are those idealists in the wizarding world who believe in a third path (Dumbledore, some of the other professors, some of the students, some members of Order of the Phoenix) and they are generally depicted as the background heroes, or voices of reason, in the series.

Answer 2

Your proposal is roughly discussed between Harry and Hagrid in The Philosopher's Stone:

“But what does a Ministry of Magic do?”

“Well, their main job is to keep it from the Muggles that there’s still witches an’ wizards up an’ down the country.”

“Why?”

“Why? Blimey, Harry, everyone’d be wantin’ magic solutions to their problems. Nah, we’re best left alone.”

The point is that magical power would be revolutionary for Muggle economy.

Extending your example of "Reparo teeth!" - it means the end of dentistry and connected industries. On one hand lots of Muggles would demand Wizards to fix their teeth immediately and costless. On the other hand the dentists and business owners would really hate Wizards.

That applies to most of Muggle professions and industries. So in a natural way, with no bad intentions, the Wizards would dominate Muggle world. And probably would be hated by most of the Muggles which might lead to repeated medieval witch burning.