I'm pretty surprised that Shuttleworth didn't see this kind of reaction coming, considering his long-time involvement in free software. Or maybe he did see it coming, and just doesn't care?
In either case, you're in a bad position when you're distributing a Linux distro that RMS starts to call out. Shuttleworth would do well to observe what happened to GNOME: they ignored their core user base, and they've been in such hot water for it that now they're backpedaling (GNOME Legacy). If Linux can't even please its core user base--aka the evangelists--it doesn't stand a chance in the wild.
Seeing this reaction coming and not caring is a reasonable strategy. In free software, RMS holds a lot of philosophical sway, but Ubuntu operates in the larger open-source ecosystem.
Let's say that free software adherents decide that Ubuntu is bad for their interests. How will they react? The GPL prevents them from forbidding Ubuntu from bundling their work as long as Ubuntu's use of the work is GPL-compliant. This leaves them with few options. They can refuse to support Ubuntu, which is fine; other software developers can patch the bugs and fork projects that the original maintainers refuse to update. They can call out why Ubuntu is bad for a free software ecosystem; this is a good thing to do, but has little impact on those who are familiar with the four freedoms but don't buy into their absolute necessity.
As a tool to exercise free use of software, GPL is very strong. But as a coercive tool, GPL is pretty weak (by design). Shuttleworth recognizing these strengths and weaknesses and adapting the company's motion to account for it is shrewd business.
Accepting the notion "I don't approve of your use of my software, but I respect your right to use, study, redistribute, and modify free software" is an implicit aspect of the free software philosophy.
In either case, you're in a bad position when you're distributing a Linux distro that RMS starts to call out. Shuttleworth would do well to observe what happened to GNOME: they ignored their core user base, and they've been in such hot water for it that now they're backpedaling (GNOME Legacy). If Linux can't even please its core user base--aka the evangelists--it doesn't stand a chance in the wild.