Fear of Putin starting WWIII keeps people at bay from taking actions against him, even though Putin has already started WWIII?

Not quite. There is still one tool that is infrequently used in Weltpolitick, but there are enough disgruntled Russians for somebody to try. Assassination.

Putin hasn't started WW3.
Putin started a war with Ukraine.

If you are going to define a "World War" by the number of active participants, we would actually be past WW3.
The First and Second Gulf Wars, against Iraq, had more nations from around the globe sending troops.

Nor is it anything new that the US and NATO avoid direct conflict with Russia.
When the USSR sent troops to Afghanistan, the US and NATO sent arms to the Afghan militias.

The mistake the US/NATO/EU made was not sending support when Russia invaded Georgia, let alone Ukraine earlier.

This Is no more WWIII than it was when the US invaded Iraq.

Fear of being nuked might be what keeps people from taking military action.  The world IS taking action in the way of sanctions and such.

Your statement is not a question.