> You will never see another small (< 20) person hardware startup (not that we see them often anyways) because the cost to produce this kind of documentation is non-zero, and the big players can easily absorb it into their processes.

I highly doubt that small players would be affected at all, because a small player wouldn't produce a custom chip. The level of documentation required is akin to API documentation that many services produce and this is not revealing any trade secrets, but enables customer to make full use of the device. If you create a product without any documentation, then you have bigger problems.

> If I start up a hardware company and make a new device, but half my components are designed in Taiwan and they've decided to explicitly reject this, am I non-compliant for not releasing documentation I don't have the authority to release?

This is false, because it is companies like Apple that tell component manufacturers to not sell or to not disclose documentation. Virtually any chip that you can get on an open market has complete documentation available. If you are ordering a custom chip, you shouldn't be allowed to tell manufacturer to not sell it to anyone else nor hide its documentation if it goes into your product.

If you were actually working in hardware design space you would know that what is being asked does not compromise trading secrets, it is done solely out of greed so that people are nudged towards subscription models and becoming dependent on a particular corporation.