The fact that they seeded the files did raise questions about distribution and permission (on comment sites like this one, anyway), but that issue was never adjudicated. The lawyer attacking Prenda (Morgan Pietz) showed evidence that the seeder's IP address was linked to the offices of Prenda Law (the law firm nominally representing the holding company), which raised questions as to why the attorneys representing the plaintiff were distributing the plaintiff's material (they were in fact the same people, if different legal entities - although, again, never conclusively proven). The various Prenda and holding company stakeholders eventually invoked their fifth amendment rights to not incriminate themselves, which raised further eyebrows since to that point it was not a criminal proceeding against them. There were several hearings where they were all ordered to appear, but they were never all in the same place and seemed to blame whoever wasn't there, while never actually admitting that any wrongdoing had taken place.
I'm not positive on your other question, I believe that an attorney is not ethically allowed to represent himself if he is also the beneficiary of the settlement, so they would have needed to hire a different attorney to represent them. Being attorneys themselves, they figured they would skip that step and just conceal their relationship to the court (note: courts do not appreciate this). That's what I think, anyway, it seems like if they were just able to say that they own the copyrights and be done with it then they would have done that, so I think the reason they didn't is to avoid paying fees to another attorney when they thought they could do the job themselves.