Of course it is....well each of the distros.
No, _Linux_, the software itself, the kernel named Linux and ALL the major components (GCC, X11, glibc etc.), everything is copyrighted.
Very few software in a Linux distribution is in the public domain. Most of it is copyrighted and owned (in the holding copyright way) by the Free Software Foundation and many others.
Yes, of course there are copyrights, but they do (and must) comply with the GPL, which is what makes them open source in the first place. Anyone is free to alter and distribute the source code in any way they see fit as long as they comply with the GPL.
Every time somebody comes up with a new improved, more user friendly distribution, he adds to the problem. There are too many distributions and not enough coherent and consistent behaviour. Each distribution has its own configuration tools.
What you see as a problem many of us see as a distinct advantage. While having choices may be a foreign concept to many, a lot of us prefer it that way. Creativity and innovation come from finding new and different ways of doing things.
As to the posed question, no Linux would not benefit in any way from becoming closed source and I fail to understand the base logic of such a question.
