That's not Open Source as defined by the OSI. You can't redistribute source code and commercial use requires paying license fees to Epic (5% of revenue). So just don't get the wrong idea about that license, please.

With UE4 they have created an engine that was extensible only via C++ and via their graphical scripting language. With the notorious instability and incompatibilities of ABIs of different C++ compilers, Epic didn't have a lot of options other than releasing the engine source so that their customers could recompile the whole engine with a single compiler version. And with Unity eating away at the indie market at that time, Epic needed a successor to the free, closed source UE3 UDK to keep a foot in that market. I don't think that Epic had a lot of other options at that point.

Unreal is source available, but not FOSS. There are a lot of restrictions in the license, sharing engine source without a (free) Epic login is against TOS for example, although you can fork the engine on GitHub and give other users that are part of the Epic organization access. I'm thinking a MIT (or some other permissive license) licensed UE.