Dan,
You aren't missing much. Maybe just a little. First, I agree with the PDF argument. Sure one can alter a PDF. But, go back a few years and one could trash an entire progress note and make another one. Hell, we did it in the hospital all the time.
I don't believe AC's intentions though are to do with stealing the software. The software is the code not the database.
The issue is that if you have access to SQL (as the database), then it would be easy to change a 104 degree fever to a 99.9 degree temp. Huge difference. Imagine sending a record to one lawyer with 104, forgetting that you did, then sending another lawyer the 99.9. That isn't just the lawsuit, that is your license.
Also, you can't change your formatting via the database. You have to do that via the code. Wherever you enter data, that goes in SQL. The structure of how the program works is due to the code.