I was a grad. student for three years. I am not sure it is a "take the work of graduate students and make it closed" kind of deal. It is more like you are an employee of the University and your work belongs to your employer. Also, at least at UT, the grant system was designed to be protective of the rights of the Grad. student/researcher so that his/her work could be monetized later if need be.
Universities I've attended have had similar rules for undergraduates, even though those cam hardly be considered "employees" with the fees they pay for courses...
