While I think your understanding of the business situation is accurate, I don't think your distinction about language vs. web APIs stands. My (non-lawyer) take on the situation is this: The interoperability exception for copyright applies only at the system level, for things like binary protocols, byte code and machine instructions. This, I think, is because at that level there is only purely functionality and little expression. Copyright law explicitly covers creative expression and not functionality.
APIs, on the other hand, are required for humans to create systems that interact with other systems. As such they are meant for human consumption and communication and can have significant creative expression. Note that to be interoperable with other Java code, Google did not have to re-use the existing API. They could have used their own APIs, or heck their own language, that compiled down to the same byte-code. This is why I think the interoperability exception does not apply to this case.
As such, I think this ruling does mean that most web APIs, being text-based and intended for human consumption, could be copyright-eligible.
> most web APIs, being text-based and intended for human consumption, could be copyright-eligible.
But the very first condition of copyright eligibility is that the work have some fixed media representation. What fixed representation does a web-API have, a representation that must be replicated for the API to be implemented?
APIs, on the other hand, are required for humans to create systems that interact with other systems. As such they are meant for human consumption and communication and can have significant creative expression. Note that to be interoperable with other Java code, Google did not have to re-use the existing API. They could have used their own APIs, or heck their own language, that compiled down to the same byte-code. This is why I think the interoperability exception does not apply to this case.
As such, I think this ruling does mean that most web APIs, being text-based and intended for human consumption, could be copyright-eligible.