Every quest, every drop, every starting location, every single bit of what makes the game playable is server side. You do not get this by getting the game. This isn’t about the use of some 3d models and textures.
While they may have recreated their data item by item and quest by quest, they quite literally stole that copyrighted material (what is THAT item named, what is THAT NPC named, what is THAT quests text, what is THAT towns name) in order to replicate the classic Warcraft experience. That is, quite literally, copyright infringement for the sake of selling a competing product. I can’t steal your apples and then set up a store to sell them for a lower price next door.
If they came up with their entirely own universe and simply reused the assets but without a single reference to the Warcraft world, maybe your argument would make some sense.
In a sane economy and legal regime, this would be allowed under open competition rules, in the same way that car manufacturers cannot prevent aftermarket mods to be sold and installed on their models. All these online platforms have big digital moats, and projects like these are offering alternatives to an otherwise captive audience. That's why Big Platform doesn't like it, but nothing about this has anything to do with stealing.