He had the choice to grant it. Or at least the choice to say that it was automatically hers, which it was. If the HRH title had been a reward for good behaviour, certain HRHs by birth should have had it removed. As it is, it's simply a style that sons of monarchs, and their wives unless the marriage is morganatic, are entitled to.
.
But I think one should not forget that the souverain is the fount of all honours. He can grant titles and styles, he can withhold them and he can declare titles, honours and styles forfeit. Henry VIII. for example had Thomas Cranmer declare his marriage to Catherine of Aragon invalid and she was stripped of her title as queen. Same happened to Anne Boleyn after she was tried and sentenced to death, thus she died not a queen. Later in 1541 he stripped Catherine Howard of her title as queen, even though the marriage was still considered valid and led to her being tried for treason on the grounds of adultery by the queen.
So if the king can strip his wife of the title of queen, he surely can withhold the title of HRH from a Royal prince's wife. I just found a document about it. From:
The drafting of the letters patent of 1937
-
The drafting of the letters patent of 1937: documents from the National Archives
This page contains transcripts of documents relating to the drafting of the letters patent regulating the styles and titles of the Duke of Windsor, his wife, and his issue (27 May 1937). They come from a file in the National Archives (HO 144/22945) that was only released to the public in January 2003.
An excerpt:
Sir Granville Ram to Lord Wigram (21 Jan 1937)
I have looked further into the question raised in your letter of 15th January and as a result I cannot escape the conclusion that if the Duke of Windsor marries Mrs. Simpson she will automatically become Her Royal Highness.
For practical purposes it seems to me that the question is settled by an announcement which was made at the time of the marriage of His present Majesty. “The Times” of 28th April 1923, contains the following:-
“
HRH the Duchess of York.
Status of Princess.
It is officially announced that, in accordance with the settled general rule that a wife takes the status of her husband, Lady Elizabeth
Bowes-Lyon on her marriage has become Her Royal Highness the Duchess of York, with the status of a Princess.”
I have not been able to discover from what quarter this announcement was given to the press, but from the fact that it appears to be based on a letter from Boyd to Stamfordham it seems likely that the announcement was made from the palace.
When I first got your letter I thought that the well settled legal rule that a woman on marriage takes rank and precedence according to those of her husband might not necessarily apply with regard to the style of “Royal Highness”, because I know that the use of that style had on several occasions been regulated separately by the Sovereign. In view, however, of the way in which successive Letters Patent have dealt with this matter it seems clear that they must have been framed upon the assumption that the same rules would apply as in the case of peerages. The use of the style “Royal Highness” is now governed by Letters Patent / dated 30th November 1917, and I enclose a copy of the notice in the London Gazette of the 14th December, 1917, which summarizes the effect of these Letters Patent: from this you will see that they (like former ones on the same subject) made no mention of the wives of any of the sons, grandsons and greatgrandsons of the Sovereign who were thereby declared to be entitled to by styled “Royal Highness”, so that, except upon the assumption that a wife would automatically derive from her husband the right to be so styled, none of them would be entitled to that attribute. Obviously that result cannot have been intended.
Unless, therefore, the King’s eldest brother is willing himself to relinquish the style of Royal Highness when he is created the Duke of Windsor, as was done by Lady Patricia Ramsay on her marriage, it seems to me that his wife must automatically become Her Royal Highness.
(sgd.) J. Granville Ram
(End of quote)
And another quote:
A. undated memorandum by Home Secretary (late March 1937)
Style and Title of Royal Highness
1. The question has been raised if the Duke of Windsor should marry, his wife would necessarily become a Royal Highness. The answer hitherto given has been that this result would automatically follow by the application of the principle that a lady of lower degree acquires by the fact of marriage the style and title corresponding to the rank of her husband. But it still remains to be considered whether a different consequence could be secured by any form of express action by the Sovereign.
2. The abdication of Edward VIII creates a condition of things entirely without precedent, for the Duke of Windsor by his own declaration, confirmed by Statute, has not only himself renounced the Throne but has barred his descendants from the succession. The eldest son of George V is neither Sovereign nor Prince of Wales - a situation hitherto never conceived of as possible and never contemplated in the Letters Patent of 1917. As the style and title of Royal Highness has hitherto invariably attached to members of the Royal Family who were
within the line of succession, or their wives, there would be a remarkable anomaly if persons outside the succession equally enjoyed it. Even if the Duke, in view of his former position, retained the title by express direction from the King as the fountain of honour, it is presumably within the legal powers of the Sovereign to direct that no other person shall derive such style and title from the Duke, whether by tie of marriage or descent. Why should ladies curtsey to a Duchess who cannot possibly be Queen?
(End of quote)
Much more information about the process of stripping Wallis of her right to the title as wife of a HRH is to be found under that link.
Interesting for me was the last sentence:
"Why should ladies curtsey to a Duchess who cannot possibly be Queen?"
For me, that makes a lot of sense: but then they still curtsey to HRH The Duchess of Kent, who as a Catholic never can be queen... And Camilla can possibly be queen...
Oh, I wish I could see the documents that were exchanged before the PoW's marriage to Camilla. For I personally doubt his experts were not able to see the problems of the situation.