From what I read, they weren't saying "no" to any and all use of the Bluebook: they were saying that what he wanted to do was incompatible with their online license, and that they would refund his online-license purchase if he didn't agree with their license restrictions and instead wanted to work on his CSL project. And—as he points out—he could do his CSL if he used the physical Bluebook as his source, in which case he would be encumbered only by copyright law and not the additional software license associated with the Bluebook online. Furthermore, they never suggested he couldn't do his CSL work with the physical Bluebook. Basically, they wanted to stick to the terms of their license and not cooperate with him, but didn't try to prevent him from doing his project via the hardcopy Bluebook. Trying to cloak their actions as some sort of bad-faith copyright over-reach is itself a serious over-reach.
The Bluebook likely did not go out and hire Ropes just because you wrote them a letter. Ropes is almost certainly their outside counsel, and likely has been for some time. Note that Ropes has not raised any copyright issues with regard to anyone using the Bluebook abbreviations, citation style, or other unprotected content. The only thing that Ropes has objected to is your posting of unredacted excerpts and/or complete versions of the Bluebook online. I'm not sure what is so objectionable about this.
Finally, your implication that the Bluebook is the only style recognized by courts in the US is wrong. Different courts have different style requirements, and many of the style requirements are, in practice, only loosely observed.
Money is fungible. If the Bluebook wasn't contributing to their bottom line, the law schools would be propping up these flagship law reviews every bit as much as they subsidize the secondary law reviews. Quite frankly I suspect the Bluebook's considerable revenue stream actually is a net benefit to the parent institutions, at the expense of the substantial unpaid labour contributed by the law students who work on it.