Aside from what user graeme said, there are plausible reports that epic tried to contract with samsung or huawei or some fairly sizable android hardware maker to put their app store, or at least fortnight, on the phone directly, and google then informed the hardware maker that they'd block the google play store from those devices if they did that.
But it does highlight the problem here.
Let's say I take epic at their word, that this is not okay (and I'm tempted, this whole judge jury and executioner thing is ridiculous. Apple has now said that they regret that they can no longer spend time with Epic on making sure the Unreal engine runs well on mac hardware. That is so close to 'nice house you got there. Would be a real shame if something happened to it' it makes the hairs on my neck crawl).
What then? Sideloading with security measures is something google has but that's according to epic not good enough (and I'm again tempted to agree).
But clearly some free for all fiesta is no good for the users. And I don't think governments, certainly no the US government and probably not the EU either, are capable of defining the playing field, this stuff is too complicated.
So... what then?
I would hope that Apple (and Google) realize that this fight has only users, and the name of the game is to walk the line so that nobody is pissed enough that you end up with exactly what just happened. And it looks like apple has decided they like the hole they are in, as it sure looks like they are frantically digging.