Their FOSS local inference service didn't go anywhere.

This isn't Anaconda, they didn't do a bait and switch to screw their core users. It isn't sinful for devs to try and earn a living.

Another perspective:

If you earn a living using something someone else built, and expect them not to earn a living, your paycheck has a limited lifetime.

“Someone” in this context could be a person, a team, or a corporate entity. Free may be temporary.

Yet. Their FOSS local inference service hasn't go anywhere ... yet.

You can build this and go build something else as well. You don't need to morph the thing you built. That's underhanded