This is an issue that Efraim and I also confronted in the Open Siddur Project.
I wrote about it here:
I'll disagree with Brett here only to say that this has less to do with Copyright in the US as it has to do with how EULA's have been used by software vendors to limit access and distribution of work in the Public Domain. EULA's are contractual agreements with users. By wrapping a Public Domain work in an EULA, Davka and other vendors have found a way to make proprietary works that are free.
The Copyright issue in Israel is actually worse. Here in the US there is no "sweat of the brow" copyright that someone can claim for doing a digital transcription of a Public Domain work. But in Israel (and other countries), this claim has been made.
Our solution has been to support wikisource efforts to transcribe and proofread new digital editions.
Personally, I see no problem using extant digital editions of Public Domain material so long as they are carefully proofread against a known manuscript or other reliable textual witness.
The problem with Davka, and for that matter, Responsa Project texts, is that without a witnessing image, there is no transparency as to
Aharon
--
Aharon Varady
Founding Director, Hierophant
the Open Siddur Project
http://opensiddur.org