The threat was so grave and existential that a new corporation, Garfield Games, was formed just to publish Magic: The Gathering, so that it could get investment that would not be threatened by the possibility of the whole company being destroyed by the Primal Order litigation.

After the TPO suit was settled out of court, Garfield Games was merged into Wizards of the Coast. The people who ran WotC in 2000, such as Peter Adkison, know personally how much water the "this is fair use!" argument

held in actual pragmatic fact for a publisher. All it took was one game company to decide they disagreed that it was fair and were willing to file suit over it.

The second event was the near bankruptcy of TSR. Again, key people (such as Ryan Dancey) involved in rescuing D&D from the implosion of TSR by facilitating its sale to WotC, had that experience to inform the creation of the OGL. It was not impossible to imagine D&D being owned by some corporate entity that did not care about it;

business owning work for hire had unwound, or no one had saved a paper trail of rights ownership/transfer. (Can you tell if it's work for hire?) As with fair use and game rules, there was a big difference between theorizing about the legal status of some work and putting your financial well being on the line by seeing if anyone will step forward and assert a right to sue you about it.

The OGL was a way to ensure that core RPG mechanics of D&D would be available to future generations --

regardless of whether they already are via fair use (yet to be tested in court), and regardless of what may be the future ownership of related copyrights. Stop the uncertainty.

Make games. Create things. Share them. Know that when you are hit by a bus, your asshole cousin who inherits your copyright will not have grounds to sue the guy who added your novel Prestige Class to his game world for sale as a PDF on DTRPG.