The point you raised is a different problem then the one I am saying is addressed by licenses and copyright

Indeed. I agree I got the wrong end of the stick about your point.

That said, there is also a problem with the assumption that copyright and non-exclusive licencing would protect the programmer (or his new clients), from legal claims by his previous clients.

There was a case came up in the news in the last 2 or 3 months, (by I cannot track down the story), where a (I think) music site in (I think) China or Tiawan, was taking legal action against Microsoft because the latter's latest design for their similar site had a functionally nearly identical user interface. Different chrome (schema, text, fonts, colors), but an essentially identical UI. I'm also not sure what if any mutual or legal settlement has come out of the case, but it serves as an intro to my point.

If this guys develops a commercially successful site for one client, and then later does a similar site for another client and that starts to be successful also, then even with the protection of non-exclusive licencing, any case of 'look & feel plagerism' claims would be so much harder to defend against, if the underlying libraries are, (even legally), the same.

And it is often a consequence of using common libraries, that even independantly designed, similar applications, will tend to work in much the same way.

That said, I don't see that obfuscation of those libraries would provide him any legal protection at all. Nor do I see that obfuscating the libraries would would either protect his clients, one from the other, nor satisfy their desire to own 100% of the applications he writes for them.

he also mentions he has no problem agreeing to sell the project specific code if they also agree to the inevitable maintenance contract.

Hm. If he "sells" them the code, then there is no inevitability about their need for, much less, obligation to purchase, a maintenace contract. If they own the code, they can maintain it (or not) in whatever way they see fit. I guess he means maintenance of the underlying, unsold libraries, but if they are neither included in the purchase price, nor licenced, what has he sold them?

I'm kind of on the fence here. I can see some of what he is trying to protect himself against, but I think that he is going about it entirely the wrong way. But equally, I do not have any solutions to offer. Especially in the field of interpreted code delivered in source form.