In another place and time, a similar circumstance is what led Blizzard to unintentionally provide the tools for inspiring the MOBA genre, which spawned League of Legends and DOTA2. That altered games forever. You'll notice few games ship with map editors anymore, and game UGC is very tightly locked down. Blizzard leaders have stated that letting MOBA get away from them was their biggest miss.

D&D is having a similar moment where companies that were built on D&D are becoming bigger than them, and WotC wants to compete more directly now that digital is becoming a priority for TTRPGs. Once you decide to do that, you no longer want to be a platform for your competitor. In a way, this is similar Apple banning apps that directly compete with built-in iOS features. While also an unpopular move, you can hardly blame them.