What I found at the time is that you can generate the seed offline by simply plugging the device into a USB powered port and selecting "Create New Ledger".
Hmm, so the seed generation can begin even before you complete the Ledger Live onboarding process and the genuine check. I remembered it to be the other way around. But like I said, several years have passed since I last had to play around with that.
However, since they wanted to use all the crap that Ledger has to offer, they needed to run a genuine check (which, by the way, is incredible good at doxxing your information each time that you install an app on the device[1]) in order to run Ledger Live and proceed in installing apps and whatnot.
A real nightmare would be if they knew exactly who owned which device with some unique key identifier that gets tied to your name after you purchase the product. They would then have the apps, balances, and people owning said coins and tokens. All that is missing are the seeds and private keys, which is being handled by Ledger Recover and hopefully hasn't been retrieved in secret already.