I don't it's the end of the world either way but only the individuals that made the contribution should be the judge of how bad it is.
I also agree with most others here that this is way too complicated. Developers have already been caught in schemes like this. The company wants to have a low quality version that is GPL'd and hopefully get some software contributions back and they want to have a nicely packaged application with proprietary features. Since anybody else that wants to fork the software would need to do so under the AGPL L-N would get these contributions through the AGPL but they wouldn't need to share their proprietary additions. It's not what the GPL was intended for.
It's complicated and I think people are wise to this SugarCRM way of doing business.
Honestly, if they are looking for bug fixes, they can just open source their software - no redistribution rights required. People who use the software will gladly contribute bug fixes. For new features development, just continue paying for them.
Or better yet, go GPL all the way. Competition might actually be a good thing and when you start with most of the domain knowledge and brains that created it, I like the odds.
The scheme you propose makes these guys look like another SugarCRM. In a few years people will be complaining about L-N and L-N will be wondering why after open sourcing their code, nobody likes them.