An unlicensed user has the ability to submit a comment when approving a submission but Smartsheet wants me to grant them "Editor - can share permission" in order for them to receive my reply. What's up with that???
It sounds like you're talking about the @mention feature in the conversations/comments window, is that correct?
If so, only users shared to the sheet will be able to view any comments, in the same way that only users shared to the sheet could see any of the grid data of the sheet (whether they are licensed or unlicensed doesn't matter).
You can share users with View Only permissions if you just want them to receive your tagged comment, but then they wouldn't be able to respond or add any more comments since that requires the ability to edit/add content to the sheet, which viewers can't do.
Our Help Center article on @mentioning (see here) outlines this perhaps a little better than I can:
People with Owner, Admin, or Editor permissions to the sheet can create or reply to a comment. You must be shared to a sheet to receive notification that you are included in an @mention comment on that sheet.
As an alternative, you could send an Update Request if you wanted a user who's not shared to the sheet to make edits to specific rows (see here for more on Update Requests).
Hope this helps!