Ah, how cute. Their FAQ includes all the typical confusions... most notably:

1) Guess that "requiring" the user have access to the original media (so you can rip sounds from it) permits you to create a derivative work with the IP on that media;
2) Send a scared email to a random Blizzard address;
3) Receive no response;
4) Tell the world "They know we exist";
5) Proceed to use Blizzard's IP without permission.

Here's my understanding of how the real world works:

Fair use effectively never allows you to make and distribute (i.e. put up for download) a game/mod/etc. using someone else's intellectual property unless they explicitly give you permission. (The only real case is if you create it for a class, or for yourself, or so on... distributing a mod on the 'net never really counts as "fair use" to my knowledge).

That said, the question is whether the company asks you to stop.

I'm not going to tell people they're doomed (anymore... I tried for years after being part of a shut-down project), but they do need to understand that they're playing in someone else's pool and they can be asked to leave at any time.

I can see it now "Starcraft 2: World of Starcraft."

It will go the ways of HaloGen, when Bliz decides to announce that they are working on Starcraft 2, they will shut these guys down.

If they do it now, its a pretty big red flag that they are working on it.

If they let them be, its still up on the air on just what they are doing with the project.

Red vs Blue is a show, not a playable mod. MS would have little grounds for intteruppting free speach with Red vs Blue. This mod is playable however so if they can distribute or not depends on Blizzards good will.

@Toneman
I seriously hope not. That would make every rts fan up in arms.

That is freaking awesome.

They have been in development that long?! Seems like another Duke Nukem Forever then.