I don't think merits sent to a banned user are wasted. They still indicate an opinion about the merited post, and this serves as an example.
I would agree with this.
We don't publicly show which users are "banned" by displaying a banner under the name or avatar, and we don't display trust in forums where people aren't (generally) trading. We don't do these things, because to do so would bias people against responses from users which have been banned or red trusted, when what they have posted might be completely correct, accurate, insightful, useful, and so on. There are a quite a few users now who are on a signature ban for plagiarism, who have made many good and constructive posts, but who would have had a "banned" banner across their posts in the past.
I've merited posts from banned users, and I've even merited posts from users I myself am responsible for getting banned. I've merited users I have left red trust for, and I've merited users I have excluded from my trust list. Merit should be seen more as "This is a constructive post, the forum needs more posts like this", regardless of who made the post.
