[johnnym]

The Software Conservancy is exactly that "legal team", and johhnym posted a link from them outlining the issues. There is no requirement in the GPL (version 2 or 3) that requires source code to be available to the public. Only the party to which the compiled code is conveyed has the right to receive the source code (and there is a 3 year sunset period). This is section 6 of the GPL3.

The fact that Red Hat and also SUSE - "pretend" to - not give away RPMs without contract is maybe not because someone could use their distros for free then, but so that they can limit the amount of recipients, as per 6's "Each time you redistribute the Program (or any work based on the Program), the recipient automatically receives a license from the original licensor to copy, distribute or modify the Program subject to these terms and conditions.". So to allow them to restrict access to the sources to paying customers.
But the thing is, that both give away free versions of their OS for testing - which is redistribution, isn't it, or are the programs in the free versions any different than in the non-free versions? I don't think so.

Additionally, what Red Hat does is to punish you for exercising that right by terminating your support contracts.

Which is already against "You may not impose any further restrictions on the recipients' exercise of the rights granted herein." from 6. With "Therefore, by modifying or distributing the Program (or any work based on the Program), you indicate your acceptance of this License to do so, and all its terms and conditions for copying, distributing or modifying the Program or works based on it." from 5 and whole 4, Red Hat is already in the sh*t and could loose their rights on parts of their OS given by the GPL as per "Any attempt otherwise to copy, modify, sublicense or distribute the Program is void, and will automatically terminate your rights under this License." from 4.

And they are under no obligation to sell RHEL to someone who they know will base a community distribution on it.

Sure, but as long as you can get free copies the redistribution has already happened. Same when you are using a cloud instance from some reseller. The problem is, that the distinct parts of RHEL are from a limited amount of people with a limited amount of mood to sue Red Hat for their non-compliance and with an even more limited amount of funds to cover the costs for such a case.

The existence of RHEL as a highly funded, multinational corporation made to profit from open source is a sign that some of the fundamental ideas behind copyleft are flawed.

I think the ideas are not per se flawed - unless the idea was to get to the current situation through it - but the execution is done poorly as it seems to allow companies to profit from the unpaid work of millions of people. It's similar to those public-private partnerships in Germany: e.g. let the community build the Autobahn and then give it away to a company to charge for its use. We're not there yet (in Germany), but it's clear that this is where it's headed. Could Red Hat be were it is today without the Autobahn parts built by others earlier?