So they were re-selling Microsoft basic floppies(which is what he seemed really angry about), or tapes way back in 1976, and GPL and linux wasn't around back then yet, so there wasn't an alternative where they could redistribute an OS for altair legally.
Exactly. They were stealing Micro-soft's products and selling them on illegally. He had a perfect right to complain.
And there was an alternative. They could simply invest the time and effort to write their own version of BASIC. That nobody else could be bothered doesn't diminish the amount of work that went into it.
I can't figure out for the life of me why somebody with an altair didn't just make their own compiler and distribute it for free. That could have settled the problem right there.
Ever tried writing a compiler to run on an 8 bit machine? You have next to no ram and no high speed storage. You also tended to have awkward, non-orthagonal instruction sets and a very limited number of registers. It's a non trivial thing to do.
There wasn't anything stopping anyone doing it. However, most people didn't have the time, knowledge or inclination to do so.