I don't see references to this -- ever -- but I saw a documentary around 12 years ago that showed Ballmer talking to the employees at some kind of gathering at a large-ish hall. Amidst all his frothing, at one point, he yelled (he was yelling most of the time), "If you find a better product, then copy it and call it your own". I was reminded of this when I read your "Ballmer in 3 steps," and thought, "That is exactly what he says to do." except the third part; I'm sure that's not part of his plan, anyway.
I never saw that video again and never have seen another reference to it. I'd say I imagined it except my incredulity at hearing this was far too palpable.