[quote name='JSweeney']
The thing is, it depends from where the emulator was created. If it was reverse engineered, it is one thing, if it wasn't it raises another major issue.
On top of that, he states his issue wrong. It isn't circumventing the hardware that is an issue... it's circumventing the copyright protection on the disk.. which is why Bleem failed so horribly. Not only was it slow and choppy, but it only offered spotty support thanks to sony changing some of the copyright protections on their disks after Bleem was released.[/quote]
First of all, Bleemcast was not slow and choppy. Bleemcast improves the graphics of the original games (even better than the PS2 does).
Second of all, you're right that the law says that making backups is legal, but circumventing the copyprotection is illegal. However, regardless of making backups it is illegal to even play the game you own if you need to circumvent the copyprotection to play it. People have been sued over this issue (research decss, and playing dvds under linux). And as copy restrictions are implemented in more and more media it will become a major problem as hardware starts to disappear. 10 years from now you might buy a playstation 2 game. You might not be able to find real PS2 hardware, but it will be illegal for you to play it on your emulator because the emulator circumvents the copy restrictions.
And for those of you that say that these laws don't matter because they are not enforced, you are wrong. With the gov'ts newly granted spying rights (read Patriot Act) they can spy on you without a court order by merely claiming that they suspect you of terrorism.
Anyway, to answer the question: Yes, making backups is legal, No, circumventing the copy restrictions is illegal, but the law is wrong.
If you don't like that then visit
www.eff.org and take action.