You can get the new code, just not the IP (DOTS, Audio, etc).
It does kinda suck, but he is not outright "squashing" it.. if you work with him, you can actually legally sell it via the 2.0 program. BOP 2.0 is actually changing the game to a DMD and that is fully blessed and they are selling it to people. Yes, there may be some royalties paid back to PPS. If he was killing these projects without an alternative path to make it legit, that I think would be more pitchfork worthy.
And if getting approval means there's no werewolf video-mode in any IJ 2.0 project.. that's probably good (sorry, they really have nothing to do with one another).