Here my questions:
Can you believe this?

Someone falling asleep flying? Sure, I can believe it. As someone once said,
"flying is long periods of sheer boredom punctuated by moments of sheer
terror".

I studied regulation back in college and don't remember any specific
regulation that said the hand must be at control at all time. Anybody can
point it out?

Hand? How about those eyelids getting in the way of a pilot's ability to
"see and avoid" as required by 91.113.

Why they really want to make us look bad?

"They" make "us" look bad?? How did that make you in particular look bad?

I'd say sleeping, drunk and disoriented pilots are all doing their fair
share of making us "look bad".