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This seems like a good idea for their brand. Many people will eventually come to see that folks on trek bikes are not acting like assholes. Also it puts them in agreement with the park rangers. It's a bit of a "walled garden" move, restricting what people can do with the things they bought, but IMHO it's good to have a brand with this stance.

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If I understand what's changing, it's just this, right?

All Trek electric mountain bikes sold in the United States will be Class 1

Everything else they've described regarding on-street ebikes seems to already agree with the law, at least for the California market, because of course they have to comply with the law.

Trek will still be making Class 3 ebikes but they won't be the sort that make sense on MTB trails. And vice versa, Trek's eMTBs will continue to be legal if operated on-street.

And for the most part, this is probably fine for most consumers, with the exception of the few folks that convert mountain bikes into rough-road steet-running commuter bikes. For them, converting a Trek eMTB into a commuter would mean having to retain the 20 MPH (32 kph) limit, because there wouldn't be an easy way to upgrade it to a Class 3. And there wouldn't be an easy to upgrade to a Class 2 with a throttle. The remaining benefit would be that said eMTB rides over bad pavement with ease. Still a rideable combination, but it does narrow some options for some prospective buyers.

Yes, there's a conversation to be had about enforcement of existing rules prohibiting Class 3 from trails, but ultimately, Trek viewed this as an availability issue, where they were vending a product that can and were in-fact enabling people to flout those rules, to the detriment of other MTB riders. And they still sell acoustic MTB bikes, so they have an interest in retaining that business while expanding into the eMTB space.

As a final note, I've always thought it was weird to call it a "speed limit" on ebikes because it really isn't: the limited value is on the motor assist, in essentially every jurisdiction. The absolute operating speed is not limited at all, which is easily achievable when going downhill, propelled by gravity not the motor. In a different timeline, this value would be called the "motor limit", no different than the existing motor limits of 750 W (USA) and 250 W (Europe), which is the value that the motor is not designed to exceed.

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Trek Voluntarily Imposes E-Bike Speed Limits | Spyke