Earlier quoted context omitted.
There's nothing wrong with building proprietary software of a couple of thousand lines of code, including themes. And people should be able to ask for money in exchange for their work. What's wrong is the bait and switch, as these projects end up being popular because of their FOSS nature.
"What's wrong is the bait and switch,[..]" Morally wrong, legally not so much. If it is under a permissive license (and it was MIT originally as others have pointed out) you can always cut a proprietary version. That doesn't take away the right to use the permissively licensed code of course.
If he edited the repo history to edit the licence that is.