Here's a possible good outcome.
1. The board fires Matt, stops chasing windmills, and settles with WP Engine. I'm kind of surprised they haven't done so already - it's all downhill from here. He's either lying to them, not listening, or they're drinking the Kool Aid.
2. Matt steps down from the WordPress Foundation and transfers ownership of wordpress.org to them. He takes his hundreds of millions of dollars and does something else.
3. The new CEO apologizes to the community and establishes public processes for removing extensions and such. Checks and balances are added.
4. The WordPress Foundation's new director orders a house clearing. Many hosting providers and developers are invited to join the board. It's no longer an instrument of Matt's will, but represents the community.
The first step will probably happen at some point.
The second step could happen, but seems unlikely. I think there's a significant chance Matt would go on a rampage if he was fired. He clearly thinks of WordPress as his personal property. If he retains control of the foundation, there's nothing to stop him from continuing his crusade there. He's certainly got the funds to do so.
The third step is effectively required if he's fired. It's even mentioned in the 48 Laws of Power.
I don't think this outcome is particularly likely, but it could happen. People do sometimes win the lottery.