In practice, there's no disaster scenario. The issue is the potential for leaving effort and hard work on the table, because a company could improve upon your code and never release it.
For example, we have Rocky and Alma Linux because so much of RedHat is based on GPL-licensed GNU/Linux. They technically don't have to release any of the MIT components, they do it because they are nice stewards of open source. Same with Ubuntu. And SUSE. Other companies could be not so nice. For instance, note that Google Chrome is not technically open source. Only Chromium is, which Chrome is built from.
In reality, MIT binaries without the source code are rare.
There are often situations in which the rational approach is to upstream enhancements, if only because it reduces ongoing maintenance of a derivative product. This is especially true of foundational infrastructure. BSD/MIT-like licensing works well for such software (perhaps less well in general).
