Sure... it's true by definition that a domain that can't be resold has no resale value, and it thus follows that it's "worthless" if the metric of domain worth is its resale value. That's iron-clad logic.
However, it's not actually a truthful description of the worth, in a broader sense, of domains. To somebody who is making use of a domain name to give a logical address to whatever they are doing on the Internet (web, email, FTP, etc.), the name can have great worth, even if he can't actually buy or sell it.
Look at it this way: it's currently illegal to buy or sell human organs, but does that mean your heart, lungs, and kidneys are worthless?
I don't think the sale of .edu, .gov, or .mil domains is allowed, but there are plenty of institutions making good use of those domains.