I'd say it's open enough to say it's free. UDK is the same deal, right?
The UDK is also FREE for non-commercial use. Feel free to use the UDK to make any application (game or otherwise) for free distribution. No additional license (beyond the EULA) is required. Just go for it.So assuming you don't want to actually sell the game it's 100% free.
I've played around with Unity, I didn't personally like the tools but then I didn't spend that long on it; the fact that multiple scripting languages can be implemented is really nice though. You can use C#, Javascript or Boo; from what I hear Boo is terrible though. The free version of Unity is really rather poor features-wise (later versions of TGE have several really good features that it lacks) and the Pro version is $1500. Hurp.
T3D is really cheap right now, but it's not free, so I guess not really appropriate.
While Source is fairly open with its modding SDK it is just that; a modding SDK. To create standalone games you will have to license the engine through VALVe but I don't know off the top of my head what that would cost you. It's probably handled on a case-by-case basis.
Then there's Game Maker of course, it
can be used to make good stuff but obviously it has a reputation for mediocre products due to its mediocre users.
As an alternative to Game Maker there's
Construct, a free, open-source (oh god this sounds like an ad spiel) alternative.
It uses an events system for programming your game or you can use Python; plus there's various behaviors for objects that are implemented as base-level plugins such as top-down driving behaviors or physics. It is however still not at its first 'full release' (version 1.0) and probably still has some bugs and such floating around in several places. It's easy as piss to learn, but I dunno what's changed, I last used it at version 0.92 or something.
