Because they didn't have a financially backed contract with those non-paying users.
does the contract enable the customer to monitor/search Meta to ensure they are honoring the contract? if there is no mechanism for that it means very little. Though I bet/hope some will feed them "watermarked"/unique but worthless things and watch for traces of that to pop up in models or something like that, but that's hatdly enough to just take their word for it.
That tends to be what discovery in lawsuits is for.
That's circular reasoning, how would there be a lawsuit if customer have no way of knowing?
Sensible companies don't take that risk.
Sensible companies don't do a lot of stuff Meta has already been caught doing - sometimes with real consequences (but never enough to actually deter them, of course) - in the pursuit of more data.
Sensible companies also don't gamble $80B on something obviously stupid like the Metaverse.
This is what the Muse Code launch blog post says:
We're also beginning to accept requests for zero data retention. Contact Meta sales to request this.
Zero data retention and "we don't train models on your input" are different things.
Retaining data is common for investigating abuse.