You have a lot of details slightly wrong. The Play Store makes money. People already have forked Android.
As for where Google makes and loses money… Don’t assume that we actually know. Large corporations are very good at hiding and shifting revenue for a variety of practical reasons, especially including tax reduction (both legal and illegal).
As for the chain reaction, by your reasoning nothing could ever be done in public policy. We never know exactly how the future will play out. But we have to deal with the damage currently occurring, and address that in a reasonable way, now. That’s how government works. That’s how the law works. There’s no better option.