I used to support a corporate CentOS fork for years. I think I built something like 10,000 custom packages over several releases. If I found a bug and wanted to submit a code fix, I couldn't just submit it, because corporate wouldn't allow us to "release intellectual property". If I wanted to donate money I had to do it from my own wallet, because the company wouldn't approve the expense.

But if our only legal option (given our size) was to pay one flat fee for infinite installs, or one flat fee per N nodes or something, the company would have approved that, because we needed to use something RHEL-like. If it's totally free, the company won't help at all. I think a few large companies could probably provide most of the funding necessary for the project, and still be ridiculously cheaper than RHEL.

I'd only do this for business-focused projects, because of the tendency for those "users" not to contribute anything back. FOSS only thrives when people contribute. Otherwise you're a one-man software welfare program.