These dueling press releases tell the whole story. (Me, I agree with Grohl and Novoselic. And shame on you, Courtney!)
ACTIVISION, GROHL AND NOVOSELIC RESPOND TO GUITAR HERO ALLEGATIONS Activision is responding to queries regarding the usage of Kurt Cobain's likeness in Guitar Hero 5 with the following statement "Guitar Hero secured the necessary licensing rights from the Cobain estate in a written agreement signed by Courtney Love to use Kurt Cobain's likeness as a fully playable character in Guitar Hero® 5."
Krist Novoselic and Dave Grohl, the two surviving members of Nirvana, have no say whatsoever in the usage of Kurt Cobain's likeness.
KRIST NOVOSELIC, DAVE GROHL STATEMENT RE: NIRVANA, GUITAR HERO AND LIKENESS OF KURT COBAIN This is a statement regarding Nirvana, Guitar Hero and the likeness of the late Kurt Cobain.
We want people to know that we are dismayed and very disappointed in the way a facsimile of Kurt is used in the Guitar Hero game. The name and likeness of Kurt Cobain are the sole property of his estate - we have no control whatsoever in that area.
While we were aware of Kurt's image being used with two Nirvana songs, we didn't know players have the ability to unlock the character. This feature allows the character to be used with any kind of song the player wants. We urge Activision to do the right thing in "re-locking" Kurt's character so that this won't continue in the future.
It's hard to watch an image of Kurt pantomiming other artists' music alongside cartoon characters. Kurt Cobain wrote songs that hold a lot of meaning to people all over the world. We feel he deserves better.
-- Krist Novoselic and Dave Grohl