Most restore disks I've used from OEMs have an OEM Key hardcoded on the disk so the user doesn't have to type in the license key on the side of their machine. These Restore Disks are permitted if the OEM is a Licensed Distributor, Lundgren was not a licensed distributor.
The ISO files that Microsoft distributes require the user to input a key.
His whole argument is questionable:
He is trying to reduce e-waste by manufacturing discs, which he says people lose or throw away, and then selling those disks to the very people who lost or threw away their disc originally?
He says the discs are used by people who feel comfortable restoring a restore crashed or wiped machines but who don't or can't create the restore media themselves. Microsoft's media creation tool is dead simple, you run it and tell it where to create the media.