Your thinking is correct. If you distributed a commercial version of
the kernel, you would of course have to supply the source code for the
kernel since the whole work is a derived work of a GPL'd source.
Also, anyone could distribute a cdrom with your source commercially.
If anyone improved it, they can't sell the improvements commercially
without distributing the source, so you would automatically have
access to all distributed improvements to your product. (As would the
rest of the Linux community).
Best of luck,
David.
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