I'd imagine it's sufficiently derivative as to be allowed? What if you wrote a model that produced summaries of the book - would that be allowed?
Because it's the right thing to do in this case? If you define what you want to defend purely based on what a law you don't agree with can be used to do, as opposed to the merits of the actual instance, you're bound to pick a bunch of really bad battles.
A world in which authors of creative works don't have the ability to have a monopoly on those works for limited terms is a world in which people who focus full-time on writing those creative works cannot pay their grocery bills.
It is also a world in which only banks, large corporations, and highly educated folks can get software written for their interests.
It's not like we're talking about situations like cable where I have to pay $100 / month to watch one or maybe two shows I enjoy and have no other way to get access at a reasonable price (and even that is debatable). You can pick up a copy of GRRM's work for < $10 without hassle and contribute back to someone whose work gives you joy and the publishers who got that work into your hands.
The author of this project is riffing on an older creative work to make a new creative work, exactly as artists did for all the millenia of human civilization, until lawyers got involved in the 20th century and fucked it all up.
As far as the project goes, the author should not be bundling the books with everything else (common sense and debatable moral issues.) I have no issue with him using the texts, it's the distribution that's a problem.