1) Small-time pirates are not worth the time and energy to prosecute, but they support an ecosystem that makes it easier for the big fish to find the cracks and leaked license keys that allow them to pirate on a larger scale. Getting the small time pirates in the side door delegitimizes the black market and makes it more likely people dipping into that market are the people they do want to focus on.
2) Microsoft now sees competition in the PC operating system space.as inevitable but wants to keep as much mindshare as possible to avoid jeopardizing their very lucrative place in the enterprise. Today it's still taken as a given that most workplace computers will have Windows, and people are conditioned to think they need Windows to be productive. They need to milk that cow for as long as possible, and if the bulk of individuals are more familiar with another OS, that's going to accelerate the transition away from Microsoft on the business desktop.
3) Microsoft likely has considered making Windows free, but to do so would undermine the two Windows cash cows - the OEM "Microsoft Tax" and the enterprise market. Offering a slightly inconvenient solution which accommodates the hobbyist without allowing OEMs to preinstall or enterprises to dodge their licensing cost just makes sense.
4) Most importantly, this is a strong signal that neither Microsoft, nor their OEM partners believe in the power of a new Windows version to drive new PC sales anymore. Going forward, we'll probably eventually see consumer versions clearly become a "Windows License" rather than a "Windows 10 License".