Comment Sega and emulation (Score 1) 155
Sega is definitely aware of emulation. Shenmue--one of their upcoming Dreamcast games--contains an arcade in the game where a few classic genesis games are playable in their entirety. Rumor has it that these games are run on an emulator--it certainly doesn't make sense to recode all of them.
Both Midway and Namco have released "classic" titles for the Dreamcast, each with a few of their old arcade titles. I'm sure Sega is considering releasing their own "Sega Classics", since if a few crappy arcade games can sell, surely a GD-ROM packed with Genesis games would. Heck, little kids that weren't around at the days of Genesis could probably be lulled into buying an all-in-one Sonic series game.
With the Playstation emulator Bleem!Cast on the way for Dreamcast (I'm assuming Sega licensed this, as all console companies control release titles--someone correct me if I'm wrong) Sega could certainly seek assistance from the Bleem! programmers if needed. Someone else mentioned that, legally, Sega cannot re-release games they did not develop (Konami games was used in the example). If Sega's allowing Bleem!Cast to be released then surely they're prepared for a legal battle with Sony. If that's the case I don't see why they wouldn't release games by other developers...legally one form of emulation is no different than another.
And about the 17-year old that created romnet/swapoo: if he gets in real trouble I'm sure his new employers will bail him out ;)