It is actually due to the fact that shit that didn't exist back when the basics of copyright law became precedent that we're in many of the situations we are today. People look at digital distribution and try to apply shit that made sense before computers existed to it.
Pop music is especially notorious for this. In games most of the time it's publishers bending over than it is the labels, because otherwise it'd be "fuck you, no, don't put our music in your game".
To answer your question, it was most likely (and I could be wrong, so don't quote me on this) a timed contract that said something along the lines of "You're allowed to use these pieces of music, that we own the publishing rights for, on your game _____ which will be manufactured on a timed basis from ____ year to ____ year" which makes sense for retail prints, but obviously doesn't take into account digital distribution at all which wasn't even a thing back then. Then they take that round peg and jam it into a square hole.
Rockstar's hands are very likely tied, here.
