1. Its their product/code they are entitled to do whatever they wish with it. Personal opionons on wether encoding their paid product is politically correct or good customer relations are irrelevant
2. Most the time, nulled versions are also encrypted still, they simply work around activation process, or other means of security and the source usually still isn't visible.
3. Their no-refund policy sounds like its based on their no-refund policy. Again its their policy and they have the right to issue refunds or not.
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