Either everyone licenses, or nobody does. And if you can't enforce licensing bans for everyone, the de-facto loser is those who you'd probably want to support the most, start-ups and universities, while your adversaries gain the upper hand.
The strongest argument for restricting distillation is arms control – but distillation is the way to defeat GPU embargoes. So, distillation goes on regardless. Only pre-training is seriously attenuated.
If we're honest, the models are compressions of everything society has ever written. A few large corporations can't own that, no more than they can claim copyright for a zip file of the public library.
The genie is out of the bottle, now. So open it up – inputs and outputs, forward-looking – for everyone.