Of course. You can host Wordpress just about anywhere that offers a recent enough version of php and access to a database
Because Wordpress is also hosting 1000s of plugins that WP engine users can install.
I’m not sure what the license regarding those things is, WP engine could probably just mirror it -
But they basically got locked out of the default ecosystem infrastructure.
I feel like mirroring the plugins would resolve this issue, since the argument seems to be centered on server costs.