The licenses are more forgiving than you think
There is nothing stopping me from writing source-code and distributing the source under a BSD license, no matter what the copyrighted material that the compiled source has to pull in.
Microsoft can choose whether to let me distribute the binary under a BSD license, but the source is OK. (And if I have bought licenses to their development environment for production use, their license normally allows me to compile things for redistribution. After all that is what I was purchasing it for.) Anyone who has not purchased the Microsoft libraries won't be able to compile it, but the BSD license insists on nothing like that. Heck, even the GPL would be fine with linking with some of their proprietary libraries if it falls under the OS exemption.
This is well-trodden ground. Open source people have worked in proprietary environments for decades and have a well-understood set of compromises to follow.
But the issue was far worse. As I recall, if you agreed to their user agreement, then you couldn't do something as simple as use their editor to edit a piece of existing GPLed C code which you were then going to compile on another platform. Likewise while you could compile anything that you wanted and sell it to your neighbour, you couldn't download a GPLed program, compile it, and then give it to your neighbour.
I'm not sure of the current status of that mess, but I think that they backed away. (Even if they didn't, I don't care, I no longer use Windows for anything.)
Cheers,
Ben
"good ideas and bad code build communities, the other three combinations do not"
- [link|http://archives.real-time.com/pipermail/cocoon-devel/2000-October/003023.html|Stefano Mazzocchi]