I see this as a symptom of a broken corporate ski instruction system. Vail has a monopoly/oligopoly on lessons, and from what I hear, the ski school pays out a tiny fraction of the ridiculous lesson cost to the instructors. I can't speak to the quality of the average lesson at Vail. However, at all the ski hills I've taken lessons from, under half were worth anywhere near what the lessons cost.
If lessons were fairly priced, and if instructors were fairly compensated, there would be no real market for freelance lessons, and Vail's margins wouldn't be impacted. And if an instructor wants to teach freelance, why shouldn't they be allowed to? The instructor and the student have paid for their lift tickets. The only barrier is artificial anti-competitive rules designed to uphold the monopoly/oligopoly.
I suppose there's no better way to make my first post here than by jumping straight into an argument. Then again, maybe that's an improvement over starting out asking "What skis should I buy?"
Anyway, as a Vail Resorts employee I may be unfairly biased, but regardless of employer, it strikes me as decently easy to point out the flaws in the thinking expressed above. Specifically, Vail Resorts doesn't have a monopoly on instruction. Yes, it holds veto power over outside instructors' using its resorts, but it still competes with the pricing of peer resorts like, say, Squaw, Whistler and Aspen. Ski school pricing comprises one of the many factors playing into the decision to choose a resort and even though terrain and resort "feel" probably constitute the largest portion of any decision, a consumer's choice to purchase ski school still hinges on its price.
That may sound silly, like saying that there's actually a competitive market for soft drinks at an amusement park, but as someone who works for Keystone, I can tell you that the quality and value visitors see from the instruction contributes to their choice. Pricing clients out of the instruction market is bad for business, so it's subject to the same market forces governing lift ticket prices, although I'll grant that its demand is less elastic (in the economic sense) than is the former's.
As for the whole bit about the Forest Service's role in policing this instructor policy, most everything has been said, but it's worth mentioning, too, that when the instructors freelance not only are they robbing the FS (and Vail) of the direct payments and concessions, but they're also getting away with tax evasion as well -- I very much doubt that any of them reports the income made on hill.
Now you may say that it's small potatoes, and fair enough, but if that's the case, then you at least need to be honest with yourself regarding the law because by extension, you're saying that the law doesn't apply to people who flout it when they're kinda sorta in need of the money and the company they're short-changing isn't very likeable anyway. How often would your new law apply? How much money would disappear from the ledgers? How would a business operate if could never count on the enforcement of its policies? I hold enough doubts about licensing (like florists in Lousiana. Really. Florists.) but this is a matter of public policy and property rights. The ensure a stable environment for business. Freeriding simply isn't an option.