In my experience, I have come accross several situations in which I
could/would and have done reverse engineering for commercial gain.

1)  I find a product on the market that was put together sloppily and
not well engineered.  It was buggy!  It dies! ETC!!!  I would not
reverse engineer the product itself as much as I would the concept
of what they were trying to do and THEN re-engineer it the right way.

2) A product was on the market but the company goes out of business
and one of my clients asks me "Mark, my supplier is dried up.  Can you
build them for me instead!"

3) I'm building a device and have a portion of it that I am having problems
with.  I know of a another device that does something completely
different than my device but a small portion fits my needs.  I will reverse
engineer that block.


However, in the situation of taking something (such as a VCR as was
suggested), adding something to it, and then reselling it would not be
a problem in my opinion.  After all, VAR's (Value Added Resellers)
do this all the time.  In fact, I support it.  If you can sell more Sony
VCR's (even tho they are modified), Sony still makes the money from
its product and even increases its sales by that many units.  VAR's
are a nessicary part of todays business.  Just make sure you re-sell the
product as a VAR.