Well, I found out about this today, and I have to say, I'm very disappointed.
The PS3 port is a completely different game, running on a different platform. This fractures the community, between those who play it on the PC, and those who play it on the console. The PC version is very different from the PS3 version, so we don't necessarily gain PC users.
The second thing is that many people worked hard to "spread Nexuiz" because they felt it was the best open source game out there, better then some commercial games even. Now all that effort is benefiting a closed source game. A lot of people feel exploited, including myself.
Third, people's contributions were sold and closed without their permission. Unless they gave up rights to vermuelen, then they still own those contributions, and can sue for a GPL violation. No CLA was signed, so this should be the case.
I think the biggest problem is the whole name thing though.