Maybe a slight tangent…but many Eurorack modules are themselves ‘copies of’ and/or 'inspired by ’ (elements of) other modules or synthesizers. E.g. many emulations of ‘classic’ (often brand related) filters and other functional components.
Just enter any major ‘classic’ brand name (e.g. Roland, Korg, ARP, Oberheim, Serge, Buchla) into the Modular Grid module search box…
But, I digress, since we are mainly focusing on the ‘moral’ aspects of ‘copying’ a module. Specifically copying functionality (which is generally the main value adding aspect of stuff, except maybe for art)
Having said that, there’s the (more or less objective) legal perspective and the (more or less subjective) ethical perspective. Although even legal stuff like patents, trademarks, copyrights and intellectual properties are often not globally relevant (or…enforced).
First of all…to see where all that ‘copying’ and ‘inspiring’ might lead to, have a quick look at any ‘app store’ to find many examples of blatant ‘copies’ and/or ‘inspired’ derivatives. Same for many physical product (amazon/ebay).
Some are actual copies. Some have the added negative side that those ‘copies’ in fact might have little in common with the ‘original’, harming the originals reputation/business. Some are just ‘inspired’, but in a way that is very much traceable to some original source.
As @Squinky said we should respect other peoples creativity, hard work and interests, even if they are not always protected by law.
Personally, on the ethical aspect, for major concepts, I would at least try to respect the original idea/creator. E.g. by asking permission (even though that might not be legally required) or at least credit/reference/mention the source/creator. And explicitily distinguish between your product/implementation and the original/source.
Another aspect is that a VCV Rack module is NOT a ‘copy’ of a hardware module. A VCV Rack module can possibly emulate/implement much of the functionality, but is generally soon limited by factors like computepower, latency and all sorts of discrete digital aspects (as compared to dedicated physical analog and/or part digital modules). And, of course, there is the physical interaction aspect of hardware that is hard to ‘emulate’.
I guess in many cases VCV Rack is not even competing with ecosystems like Eurorack. Accessibility/prices being an important factor. There is even the case to make that VCV Rack is supportive to the physical modular ecosystem(s). Introducing people to modular/modules and stuff they might decide to buy later.
I’d say actually exactly copying a module is pretty questionable, even if it is legal. And when implementing and/or (re)combining very similar specific functionality/behaviour/elements, it would be the ethical way to at least credit the source.