How is not giving the domain name to DDG using their monopoly to suppress competitors? This is not equivalent to say, removing DDG from their search results.

I don't think that's what they're saying. The point isn't that withholding the domain name is the end of the world, the point is that handing it over is a small token that Google can use to claim that they aren't anti-competitive. I don't know what my stance is on that interpretation, but that seems to be (to me) to be the intended interpretation.

Does that make sense?

That's not what they're saying. If/when the feds come after Google for (most likely unrelated) monopolistic suppression, Google can say "we don't suppress our competitors--look how we helped out DDG!"