In the sense you mean, Ryzom can't be distributed at all. There can only be one Ryzom-the-virtual-world (I'm making some assumptions here about the server structure because authoritative sources appear to be slashdotted or otherwise offline) which includes all the players and their current state and so on - and it can't be "released as free software". So obviously that can't be what people mean.
Generally when someone says something and your first attempt to parse their utterance is nonsensical you should try again. If I say "I have all the James Bond cars, I keep them in a shoebox" this rule allows you to strike out the possibility that I literally own all the cars from the James Bond movies, that they are small enough to fit in a shoebox, that I believe I inhabit a fictional universe etc. and reach the conclusion that I am speaking of toy or scale model cars. It's a helpful technique - and you won't find yourself so often arguing vociferously about nothing.