You've read the basics. Yes, the software is legal; no, LW doesn't give you the right to download stuff that isn't authorized.

How do you know if the file you want to download is authorized? Well, there is no clear way to know easily, so you're left with your best judgement. Use the magnetmix button: that material is clearly authorized for sharing.

Actually, I rather find that the fun of LW is finding material that is not illegitimate. For example, many people share images. Just search for default digital camera filename conventions, like "dsc .jpg" to see what I mean. Among the thousands of home photos that only grandma will enjoy, there are some pretty cool ones.

For more detailed info about YOUR situation, in your country, it sounds like you need legal advice.

btw--asking for legal advice in an online forum is like asking for medical advice in a coffee shop. And you've asked in the wrong forum. This one is like the loading dock