Sure, if I use some code as inspiration for solving a problem at work, that seems fine.
But if I copy verbatim some licensed code then put it in my commercial product, that's the issue.
It's a lot easier to imagine for other applications like generating music. If I trained a music model on publicly available Youtube music videos, then my model generates music identical to Interstellar Love by The Avalanches and I use the "generated" music in my product, that's clearly a use that is against the intent of the law.
It is not uncommon to ask person to "explain in your own words..." - as in use your own abstract internal representation of the learned concepts to demonstrate that you have developed such an abstract internal concept of the topic, and are not merely regurgitating re-disorganized input snippets.
If you don't understand the difference...
edit: That said, if you can create a computer capable of such different abstract thought, congratulations, you've solved the problem of Artificial General Intelligence, and will be welcomed to the Trillionaires' Club
The ability to generalize actually seems to keep increasing with the number of parameters, which is the key interesting result in the GPT-* line of work that Copilot is based on.
Being able to predict the most likely succeeding string for a given input can be extremely useful. I've even used it with some success as a more sophisticated kind of search engine for some materials science questions.
But I'm under no illusions that it has the first shadow of a hint of minor understanding of the topics of materials science, nevermind any general understanding.
It seems we're discussing different meanings of the word "generalize".