I think you're probably right in your speculation but that argument is just wild.
Are they going to argue that somehow mental health injuries somehow need more protection than physical injuries? If Dawson Garcia had broken his leg at UNC, he still would not qualify for an extra year (per the rules as currently written). So does mental health get a super exception? Are they changing the medical exception in general to mean like anything more than 1/2 a year?
Even if it's a NIL argument, I can't see how he missed any potential money. It was implemented in 2021. He had 4 seasons of being eligible for whatever money he could make from NIL.
Dawson Garcia is kind of an interesting canary in the coalmine. If he is granted another season, I guess they are just going to add another season for everyone. If you're going to add 1 more year for everyone? Why not 2? Why not 3?