Well written, but how is this event fundamentally breaching the MAME team's self-defined morals, which have disregarded (or sidestepped around) the holy principle of private (intellectual) property for the last 25 years ?
I mean you could have written mostly the same slippery-slope tirade the first day a copyright holder sent in a C&D. And IMHO 1995 Namco had a better point, at least from the legal POV, as the "actual creator" of the product.
MAME, like other emulators, comes from the hacking / reverse-engineering culture, which has always been willing to bend the rules a bit to pursue art, experiments, research... it's just that most people tend to grow more right-wing as we get older and richer
That collector has the right to be furious because we're all entitled to our opinions and feelings, I'm mostly amused because there's been no harm except from the sudden loss in value of his collection, but this is what happens when you speculate, sometimes unexpected things happen and your little gamble bites you in the ass. Especially when you "invest" in immaterial stuff. "High-end collectors" should still value the real machine, right ?
When it comes to MAME's reputation, I don't think there's anyone in the universe still undecided about whether or not they support the project, so I don't think it changes anything.