Parent is using the OSI's definition of open source.

[1]: http://www.opensource.org/

Microsoft makes the Windows kernel source available to a number of entities [0], but this source is not to be distributed freely. Open Source is usually construed to mean that the source, if you have it, can be distributed to freely.

[0] http://www.microsoft.com/resources/sharedsource/windowslp.ms...

You can get official Windows source, under restrictive conditions. Mainly used by governments, and some other large organizations.

The rest of your question is somewhat confusing.

Nitpick: Open Source is defined by the Open Source Initiative[1] (OSI), not by the FSF, which defines "Free Software".

In fact, "Open Source" was defined specifically as a way to drop the philosophical and ethical approach of "Free Software".

[1]: http://en.wikipedia.org/wiki/Open-source_software