In your article, you say the software is being "sold pre-installed on a web host." This description is a little vague. The correct answer to your plea for help and comments depends on the correct interpretation of how your software is being used.
1. Is the offending software used by customers of a shared or dedicated hosting provider? In that case, there is nothing you can do. This particular use falls under the "internal use" clause. As long as the binaries of the Moodle-based software are not being distributed, they are allowed to modify and host sites with this modified base all they want.
The GPL only covers distribution of source and binaries; it says absolutely nothing about the third-party use of modified code.
2. Is the offending software bundled with hardware? In that case, they are not required to provide "the original software and patches". What they are required to provide is the source for their modified version. If they are not doing so, then they are in breach of the GPL. I encourage you to contact them and inform them of their breach, and see where it leads. If they don't comply, there are many groups willing to help at least educate you about your legal options (they may not be able to help you mount a legal response, though, because of financial concerns).
Quick comment for all of us
I take this opportunity also to call for broader financial support from our community to the FSF, Linux International, EFF, and other similar organizations. Maybe I am preaching to the choir, but it may be worth repeating.
Many of us are working on free software on our free time, and do not have the financial resources necessary to defend our freedoms and property. These organizations are willing to help, because in the long run it helps defend their freedoms and property too. But these organizations need our financial support to even be able to operate their offices in any recognizable manner. Soon, maybe sooner than we think, one of them may not be able to operate continuosly any longer, to say nothing of coming to our defense.
If we all chip in just a little bit, we can accomplish the same as one single person giving a lot.
Over and out,
New Radio Free Oz :-D