> they could be trying to prevent someone from using their service to do a bunch of heavy lifting, then hosting the output somewhere else.

I would bet a paycheck that this is the case. There was a pr/faq review that had an awkward question where the marginal cost per “transform” was horribly underwater. The principal pm or gm was (implicitly?) banking on indirect revenue contributions from subsequent inference/instance hours/etc to make the 3 year P&L and revenue projections make sense. This TOS update was how they squared “best intentions” with actual scrutiny.