Like the GPL is misleadingly almost free? As in it's free but if you release software which uses GPL software, it is under GPL? I am not arguing about the meaning of free, I am arguing against your "it's a license that's misleadingly almost free". Just like GPL's terms doesn't make it non-free, "don't use it for evil" doesn't make it non-free.
EDIT: I see people arguing about "don't use it for evil" violates "can use it for any purpose" clause. Fine. GPL's clause violates "use it to distribute software without making my whole software GPL."
On the practical side: the GPL is established and popular enough that you should know what you're getting yourself in for with GPL code. In theory I can imagine someone unfamiliar with the free software movement hearing that a piece of GPL code was "free" and assuming that meant they could use it in their closed products, but in practice when people talk about "free" software they tend to either mean the free software definition, or "freeware" (i.e. binaries which can be downloaded without charge) - which generally doesn't permit modification and redistribution. So I don't think this is a practical concern.
By contrast Crockford's license is not popular or established. Worse, it looks exceedingly similar to a popular, established license - the MIT license - which is free (in the free software sense). So it's very possible to accidentally download a Crockford-licensed piece of code, thinking that you can use it in a free software project, when in fact the license does not grant all the rights you would need to do this - as is demonstrated by the fact that the author of this post did exactly that.
Crockford is free to distribute his code under whatever license he likes, but using a license that looks very much like the MIT license but grants you a much smaller set of rights (a set which puts it on the other side of a line that, while in many ways arbitrary, is of great practical relevance when it comes reusing code in the wider internet community) is not nice.
Maybe if would be easier if instead of "free" we started using more precise terms like Free(c)FSF, $Free, or name actual licenses, since each one goes under some assumptions.
So what is he supposed to do? His options are either use the MIT license unchanged, or invent his own? He liked the MIT license, and he wanted to add one of his own conditions. It's as simple as that.
As another commenter pointed out, the cognitive dissonance is the free software community is mind blowing. We are all for freedom and choice, as long as you are playing by our rules. We are against regulation, but only bad regulations. Ours are meant to do good and you are supposed to follow them.
What Crockford's done is the equivalent of changing a few bytes in the PNG format and making his software use this "new" format. Making a completely new file format/license is fine, but you should only do it when your improvements are big enough to justify the incompatibility. A new one that's just a trivial tweak to an existing one, but incompatible, is bad.
Don't write "use" when you mean something else entirely.
Lots of GPL in-compatible licences are "Free" according to the FSF. Here's a whole list of "GPL-Incompatible Free Software Licenses": http://www.gnu.org/licenses/license-list.html#GPLIncompatibl... Some notable ones: Apache Licence, BSD licence, etc.
Guess what, I can't use GPL in my projects, because it's not compatible with the kind of license I release my programs. You can't use this software because it's not comapatible with GPL. Feel the pain. FSF would advice people not to use GPL software if they can't stand the license. The same applies to you, if you really want to use your software for evil purpose, just license it that way. Otherwise, use something else. It's that simple.