When the software is offered without hard goods, the same rights and restrictions apply as with the GPL license. However if a hard goods manufacturer wants to embed the software, or if a dealer wants to sell a turnkey hardware+software solution, then a separate license is required.or in other words, the LinuxMCE project is fully GPL-compatible UNLESS you are selling a "hardware distribution":
“Hardware distribution” refers to selling some tangible hard good, such as a computer, television or automobile, which includes this software pre-installed or installed by the selling party or one of its agents, or if the hard good is marketed with reference to the software or its features.SRC: plutohome.com/index.php?section=public_license]Pluto Public License
And which is which is made perfectly clear on this page: wiki.linuxmce.org/index.php/License
I think Pluto's just watching out for themselves, which is fair, given the amount of work they put back to the project. All of the tools or software components that LinuxMCE use are available in some form or another in the open source community. But the hardware drivers for the DCE-router and the router itself are what constitute the essence of LinuxMCE, and not its disjointed parts. Given that the DCERouter and most of its hardware drivers came from Pluto, I wouldn't expect otherwise.
However, it must be emphasised that LinuxMCE IS dual licensed in a commercial setting. And although you don't have to be a lawyer to understand these texts, I think it would take a lawyer to see whether the Pluto Public License stands up in court, as the GPL is commonly recognized across the globe. The main question would be whether this type of dual-licensing would be in violation of the GPL, and thereby self-contradictory.
But those issues aside, and like I said before, I think the motive of Pluto is self-preservation. You probably could sell a "turnkey solution" using LinuxMCE, they just want to know who you are and that you're not ruining their business.