I'm no expert on the rules of pattern. And I've never tried to sell my knitting either.
But I do sew and have sewn for profit. [Things like wedding dresses and such].
The way that I've always handled doing craft work for other people is by selling my time.
I think you could apply this to knitting too. For example, if you were approached by someone who wanted a sweater you were wearing but it was from a pattern you bought, you could tell them they would have to buy the pattern too. I do that with the bridal gowns I've sewn. Each Bridesmaid buys her own pattern. Why? Often because they are very different sizes and yes I could alter, alter, alter patterns or I could take the easier road out.
I believe the intent of the "for commercial purposes" means that I can't make up 60 of a specific pattern, free or otherwise and then sell them under my name. Essentially the creativity behind the sweater isn't my own. I didn't design the pattern and I shouldn't take credit for someone else's efforts in such a public way.
I am not a lawyer, and I know I have likely made some errors but that's what I've understood.
Hope that made some sense!