The confusion over 'free' is the same problem free software / open source have had to deal with. The free has two meanings: unencumbered and without cost, libre and gratis, or free as in speech and free as in beer. This is one reason called the OGL rather than a Free Gaming License.
In this case Mongoose pared the material from the TMB down into the TSRD and made it available at no cost. An alternative would have been to put a copy of the OGL in the TMB and have an extensive declaration of which bits are OGC and which bits are closed and what is PI. Then the first step to using the material would have been to buy a copy of the book.