This is indeed a blow for all free platforms.
for the next couple of years, the only way to get channel 4 HD and five HD for free is with a sky HD box and a freesat from sky card. And of course with that combination you can't record those channels.
If you chose to buy a freesat PVR expecting to get lots of free HD channels that you can record for free, you will be disappointed.
If you were expecting to buy a freeview HD PVR soon, you will be dissapointed, and as a result of this, I expect freeview HD to be a flop.
I think the only decent thing sky could do now, having got the monopoly on the free HD "psb channels" is to allow freesat from sky users to use the recording functions of their otherwise crippled sky HD boxes. Perhaps they could do that by selling a slightly more expensive "freesat from sky+" card?
But of course if sky do that, it would probably be the final nail in the coffin for freesat, as free recording is about it's only USP.