I doubt that ID Software GPL'd the version of Castle of Wolfenstein that they submitted to the AppStore. ID Software owns the copyright on Castle of Wolfenstein, so they can release it under whatever license they want. They can even release it under multiple licenses.
The GPL 'issue' is that, if I fork a popular project under the GPL, I don't own the copyright so I can only ever continue to release it under the GPL, I can't change the license because I don't have the legal right to. If I wanted to publish said GPL'd project to the AppStore, my only option would be to release it under the GPL, which is incompatible with App Store licensing requirements.
I know that if you fork a GPL licensed project, you have to release your version under GPL also. That's why I said "Obviously folks other than Id Software can't relicense the engine under something other than the GPL"
My question was, how is the GPL incompatible with App Store licensing requirements? I haven't seen that spelled out before. The reason I brought up Wolfenstein was because an article I read back when it was released for the iPhone led me to believe that Carmack was almost expecting (perhaps even looking forward to) people forking it and making their own games for the iPhone with it. That is why I was surprised to hear that the App Store wouldn't allow a GPL licensed application -- since that would make such an outcome impossible.
The GPL concerns how other people can use your code - if you release something under the GPL, you're not personally bound to it.
The trouble comes when you accept patches written by other people, because while you are still free to release 'non-free' versions of your code, you are bound by the GPL with your use of theirs. A good example is Linux - they can't really move to GPL 3, even if Linus wanted to. They would have to get 10s of thousands of people to agree to the change.
The App Store is a distribution mechanism, and it imposes restrictions on distribution that the GPL does not have.
One such restriction is that any binary downloaded from the App Store is only licensed for usage by the user downloading it. You are legally forbidden to take that binary and copy it on another iPhone of another user (we aren't talking about technical details and how users could do that, but about what the iTunes App Store EULA says).
Bottom line is that the GPL doesn't allow the extra restrictions that the App Store is adding.
The GPL 'issue' is that, if I fork a popular project under the GPL, I don't own the copyright so I can only ever continue to release it under the GPL, I can't change the license because I don't have the legal right to. If I wanted to publish said GPL'd project to the AppStore, my only option would be to release it under the GPL, which is incompatible with App Store licensing requirements.