Control of the server is the DRM. Radical Heights sold hats for $15. How do they ensure only players who paid for hats get them and that non-paying players couldn't just mod them in? They control that information on the server. Which accounts have cosmetics is controlled by the server. That's the DRM. If they had to release the server when shutting down then they'd have no way to ensure only paying customers play the game since the person who runs the sever can modify it however they want. Everyone could get the $15 hats for free! Or maybe they charge $2 for the hats. There's no DRM that could prevent this because control of the server is itself the DRM.

So a dev is being required by law to give out their game without any DRM meaning anyone can play it for free and even give themselves the cosmetics the original devs were using to pay the salaries of the dev team. I worry very much that this would cause companies to stop producing free to play games or charge a subscription for these types of games instead (since subscription based games would be exempt). I wonder why people would risk this to "save" games like Radical Heights which, in all likelihood, would have no community. A game doesn't shutdown after 1 month because it has a thriving community