The fact is that a teacher making a bunch of copies of something as hand-outs for their class is so common and benign a use case as to be mentioned in the statu

The fact is that a teacher making a bunch of copies of something as hand-outs for their class is so common and benign a use case as to be mentioned in the statute, just to ensure that it could not be precluded by factor #3. Educational use itself is part of factor #1. In any scenario where a teacher was copying educational materials for a class, I would have a hard time seeing it as anything but fair use barring unusual circumstances. Which was, I think, the point they were trying to make.