Delayed or never received payments are common for video game freelancers. Most projects fail, and so the likelihood you don't get paid out for a portion of your work is very high. You just have to eat it and set your rates accordingly. iD/Zennimax are big enough there's no excuse here, but as far as mentality anyone that's been freelancing in games has probably crossed over into this territory of just hoping the client stops being an idiot at least once if they're honest.

If it’s so common why don’t the well known freelancers insist on upfront payments?

These contracts are very asymmetric in negotiating power. That's actually true of gaming in general: as both an artist or coder you'll almost certainly make more money and have a much better work life balance outside of gaming. Freelancers are even more disposable.

Basically, people who wanna make games do so mostly out of personal passion, and that means they get pretty screwed in negotiating compensation.

How does that stop them from negotiating a lower rate, but paid upfront?

That relies on the other party agreeing to such terms. They may well choose a pay-later setup offered by an otherwise more expensive contractor, and then go on to play accounting reindeer games just like this.

Well presumably the other party will agree at $0. So it’s really a question if there’s a mutually agreeable price, not whether it’s feasible in the first place.

I am 100% on Mick’s side here, but so much about this situation screams naivete and poor contracts/legal advice on his part.

He should have come down on them like a ton of bricks as soon as they announced an OST with his name on it, but that hadn’t been contracted (which both parties admit, so it’s definitely not he-said she-said).

Sounds like he let he guard down due to having a prior relationship with iD.

And he’s an artist and writing the music for a doom game is a huge creative opportunity for him. id clearly took advantage of that. Too many companies exploit artists who believe in their art. It sucks.