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There's no problem with it: As you say, it removes one barrier people have to making their software Open Source, which leads to more Open Source software in the world, which is good. It also allows strongly curated projects like SQLite to be Open Source, which is even better. Anyone who feels strongly about contributing to such a project is free to fork it.

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sqlite's test suite is substantial and not open source, I doubt you could really fork it in a meaningful way

That raises a practical barrier to forking, but someone who is willing to get a testing suite up and running can fork the project and benefit from upstream changes on an ongoing basis.

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