The real problem with the way Spotify distributes the money, is that they distribute it per play. This seems reasonable on the surface, but I think it's pretty shit. I want my subscription fee to go to the artists I listen to. Right now they're going to what most people listen to. This effect is worsened by the per-label deals: imagine if Beyonce wasn't on Spotify, that would be bad for Spotify right? This gives her label (and by extension all major labels) massive leverage over how this works. It massively favors big artists.
The per-play model also enables playfarming as an economically viable scam.
What incredibly enough hasn't been brought up yet, is the distinction between gender preference and genital preference. In heteronormativity they're assumed to be the same, but in reality they're not. This way of thinking also lends itself to the flexibility you're describing; note the word "preference".