First, let me state the difference between lite and full of C32. It is not very significant. In Lite, -o2 and -o3 optimization are disabled, that is the only difference. This is what happens when you fail the license check, copied strait from the source.
/* Disable -O2 optimizations */
NULLIFY(flag_crossjumping) = 0;
NULLIFY(flag_optimize_sibling_calls) = 0;
NULLIFY(flag_cse_follow_jumps) = 0;
NULLIFY(flag_cse_skip_blocks) = 0;
NULLIFY(flag_gcse) = 0;
NULLIFY(flag_expensive_optimizations) = 0;
NULLIFY(flag_strength_reduce) = 0;
NULLIFY(flag_rerun_cse_after_loop) = 0;
NULLIFY(flag_rerun_loop_opt) = 0;
NULLIFY(flag_caller_saves) = 0;
NULLIFY(flag_force_mem) = 0;
NULLIFY(flag_peephole2) = 0;
NULLIFY(flag_schedule_insns) = 0;
NULLIFY(flag_schedule_insns_after_reload) = 0;
NULLIFY(flag_regmove) = 0;
NULLIFY(flag_strict_aliasing) = 0;
NULLIFY(flag_delete_null_pointer_checks) = 0;
NULLIFY(flag_reorder_blocks) = 0;
NULLIFY(flag_reorder_functions) = 0;
NULLIFY(flag_unit_at_a_time) = 0;
NULLIFY(flag_web) = 0;
NULLIFY(flag_rename_registers) = 0;
/* Disable -O3 optimizations */
NULLIFY(flag_inline_functions) = 0;
NULLIFY(flag_unswitch_loops) = 0;
A few days ago Dave pointed out that, despite not being well publicized, the PIC32 compiler (C32) was actually GNU open source. That was news to me then but shorty after it occurred that it should have been obvious. C32 is based on the MIPS GCC compiler, and therefore, they have no choice. After further reading, I found that the standard libraries are governed by either the MIPS license or the BSD license. As far as I can tell, the only thing that is Microchip licensed is the peripheral library. The only condition attached to the peripheral library is that you use it only with Microchip MCUs.
In summary, I am no lawyer but it appears there is nothing that legally prevents you from using -o2 and -o3 without paying the $895 fee.
A humorous side note: I had no trouble locating and downloading the source on their website but apparently that wasn't always the plan.
From the license:
For a complete machine-readable copy of the source code corresponding to the files listed at Section 2(a)-(b) above, refer to the Company’s website or mail your request and $100 to Microchip Technology Service Center, 2100 West 14th Street, Tempe, AZ 85281.
I don't know "machine-readable" is supposed to mean but I think that
coupled with clueless fanboys made up their original fee enforcement strategy.