It fits completely. If you purchase the coffee, you've exchange money for coffee, and expressed rights. The same could be said for GPL'ed code. I can purchase the code with specific rights. MySQL is a prime example of this happening in the software world.

The hippie isn't selling coffee, he's giving it away with terms, but you can clearly lie to the hippie and use the fruits of his labor in a way in which he's specifically asked for them not to be used.

I think your second sentence is the thesis that the metaphor is trying to refute, though. Refusing to give you something under terms that you would like is not removing your freedom any more than any other copyright, it's offering you an option other than growing your own.

Um, the analogy clearly states that the hippie is selling the beans:

    A better comparison would be that someone writing free software is like a hippie
    who grows his own coffee beans and sells them at the side of the road by his farm

Wow, I remember actually going back to check that and I still got it wrong. Must have been distracted by something shiny. Criticism still applies, though. Part of the cost of buying the coffee is his terms. He's giving you an option that you didn't have before, but if the cost is too high, there's always Starbucks.

This is why I used the term “selling.” There’s always an “exchange of consideration” with software that is not placed in the public domain.

Purchasing, yes. Purchasing. That's a rather important word. Consider its implications for a while, and I suspect you'll see the point.

I don't follow. You can do whatever you like with gifted items too.

Free/open source software is not a gift, even an MIT license does not give you total freedom to do whatever you want.

To make a pure gift of code to the world, you would have to put it in the public domain (and even then there are odd legal issues in some jurisdictions).

Yes, but the point of the top-level comment was the analogy being a poor fit.