A trillion parameter SOTA model is not substantially comprised of the one copyrighted piece. (If it was a Harry Potter model trained only on Harry Potter books this would be a different story).
Embeddings are not copy paste.
The last point about market impact would be where they make their argument but it's tenuous. It's not the primary use of AI models and built in prompts try to avoid this, so it shouldn't be commonplace unless you're jail breaking the model, most folk aren't.