The issue is not that all websites should let anyone in, it's that Google often controls the entire stack of website, ad network, browser, operating system, and mobile device. So Google can use this to pressure web users into using Google products that they otherwise would not have used, without providing any benefits. You can't use Google Search without attesting that you're browsing with unmodified Chrome on unmodified Android on an unmodified Pixel, for example. Or, an independent website can't run Google Ads unless it verifies all users are visiting using approved Google web environments.
If it were impossible for a company to have such a high market share in all of these areas at once, this proposal would be much less concerning.