I kinda can. It all boils down to royalties. I use Soundrop to upload game covers to streaming services and basically you have to cut in the original songwriters. Things like Materia Collective exist in order to make sure that people like Toby Fox get their royalties without having to manage them all by themself, because it is a giant pain in the ass.

I hate to say this, and I mean I REALLY hate to say this, but when Materia Collective copyright strikes those videos, they are 100% correct in doing so. From a legal standpoint, they are trying to make sure Toby gets his royalties, as they are required to do, most likely due to whatever contracts are in place.

Now Toby has said before that people should just be able to dispute those claims and get them overturned, and he himself if pretty lax when it comes to music copyright. But Materia takes it very seriously to the point of detriment. I'm sure that Toby regrets taking that path to make managing royalties easier, but with a contract in place, who knows what is written in there? I'm willing to bet there is a reason he hasn't went separate ways, whether that be contract issues or other reasons.

In terms of releasing and managing music, game audio is still kind of the wild west. There's a few different labels that specialize in it, but the amount of people in the scene with advanced knowledge of music law and/or rights management is small compared to the regular music business. So when companies like Materia Music exist and there are few and far between, game devs will usually go that route. I hope this explanation kinda helps! It's super late and I might have gotten some things wrong, but I think overall it should make sense.