Exactly. Steam is more convenient than manually maintaining a large gaming library and keeping it up to date, and collecting titles on sale. However if it develops a reputation of killing games once a publisher decides to (???), the value-add is greatly reduced. I have a probabilistic expectation that my Steam library will work ten years from now, and stuff like this GREATLY reduces my estimation of the probability.
They can demand contracts that would allow them to. We have no way of knowing what exactly valve's distribution contracts allow them but so far games have (AFAK always) remained available for download if you purchased them before they were removed from the store. Key activations generally also still work - e.g. you can hunt down a physical copy of the original Prey and activate that on Steam and download it there (unless you get scammed and are sold a copy with a key that was already activated). And it is very much in Steam's interest to keep the pretense that what you are doing is buying something like a physical product that you can keep forever (*).
The difference for this game is probably that in addition to Steam the game requires Ubisoft-hosted DRM servers which Valve has no control over.
(*) For as long as you live, unless someone forces Steam to allow transferring subscriptions to other people.
