That's only partial truth. It's true that most of pirated users would never buy games. But there are plenty who would buy games,but they don't because "why pay if I can get it for free?". This might not hurt the big companies like EA etc,but it deffinitelly makes a difference for the small ones,as there are most likely some game developers who quit because not getting enough revenue from their work to support normal life.
It's the emulated LFSW,that really hurts LFS sales - cracking and getting access to content isn't that big problem,because the biggest upside of licenced LFS is the easy online system,stats and automatic skin downloading. I mean,you can still join some IP hosts and race with buddies,I used it too many years ago when I was financially in deep $#!t,but we always looked up to legal LFS as the better way.