If I understand correctly, you can use the free, non-commercial-use Dyalog to run the AGPL Co-dfns compiler to produce programs. And also, the Co-dfns output is not independent of the compiler itself, meaning that the output must also be AGPL.
I'm speculating, but I suspect that anyone using Co-dfns output will be running it on a private bank of GPUs over a large private data-set, so I suppose the AGPL won't ever matter for them, in practice.
If that works for them, more power to them! They'll still likely need a commercial Co-dfns license if they are doing that, not because of the produced code, but because of the programming environment in which they do the development, unless they want to slice Co-dfns out of its "host" environment.
You are right, however, that you can use the free, non-commercial Dyalog to run the AGPL Co-dfns. Co-dfns is both a commercial and a research enterprise, and so it is important to me that the ideas in the compiler are manifest openly to the public, hence the open-source nature of the project. However, it also needs to fund that research somehow (have you ever tried to get a grant to write APL? Hahahaha!), and so commercial uses need to be managed in a reasonable way, namely, something mutually equitable.
Some interested parties are working to use Co-dfns in public facing services, and not just private data sets. One group is very slow moving, but we're exploring the possibility of a rewrite of the cryptographic stack.
I'm speculating, but I suspect that anyone using Co-dfns output will be running it on a private bank of GPUs over a large private data-set, so I suppose the AGPL won't ever matter for them, in practice.