The program that runs the controller is sold with the controller. That is the copyright protection KnifeEdge/RealFlight/GreatPlanes uses.

The retail copies all are coded to request and verify the serial number of the disc and the serial number of the controller that was sold with that disc. They do not provide for other situations.

That design logic protects them from copyright infringement. It has worked well enough that they're still in business and producing new content in a market that has not proven to be very difficult.