I can sympathise with both sides in this dispute.
One problem is that the US has “public domain” and the UK (& Europe) does not. The difference in copyright laws has been a sore point for 100 years or more. Artists in the 19th century moaned about US publishers making money from unauthorised reproductions of their work!

I have really wanted to use NPG images in web articles on not-for-profit, publicly-funded UK cultural heritage web sites. Web pages with just text are very dull & don’t encourage people to read and remember information. Their rate for using their images on web sites is too expensive for publicly-funded projects on tight budgets.
On the other hand, the images are in the care of the NPG. They have public funding to care for & provide access to the collection, but like all heritage collections, their Gov-provided funding will not cover the costs and they have to make as much money as they can to bridge the gap and to continue to conserve, collect etc.
Public collections do get exploited a lot because they don’t usually have resources to sue.
Personally, I think that the answer is to allow people to use low-res images of medium size on suitable not-for-profit web sites, with link to NPG site (& shop!).