13/2 Indices, page-580

"There is also the question of who gets the benefit of any franking credits"

I dont see anything untoward here.
Bear in mind that no actual dividends (cash or franking credits) change hands between companies and CFD traders.
Dividends are transactions between companies and the registered owners of shares, the fact that CFD traders place a bet on the value of shares/indices does not change this reality.

My interpretation of whalewatcher's post is that the dividend adjustment are book entries to realign the CFD positions with the XJO for the value of the regular cash dividends only. (S&P do not adjust XJO for regular cash dividends)

The value of franking credits for CFD traders is unknowable, depends on the tax status of the trader, and then there is the 45 day rule, how many CFD positions stay open longer than 45 days ?

Note: I believe S&P consider the value of franking credits for their total return indices.