Jailbreaking is the process of removing the limitations on your iPod set by Apple. Once jailbroken, you can download third-party apps, extensions, themes, fonts and much more that you normally couldn't do before.
It is up to you. No matter what you have on your ipod will become messed up when Jailbreaking...
As of today (November 24th, 2010), jailbreaking an iPod Touch is not illegal. Is it 100% safe? No.
Jailbreaking an iPod could either be a success or a failure (meaning your iPod could break). It's your decision, but a risky one.
I think that many people are finding the most jailbreaking software for their ipod.
Yes, jailbreaking does void the warranty.
Yes
It is illegal.
no
you cant
jailbreaking the ipod touch is legal. But if you use the tool that gives you all apps free it is illegal.
You cannot get all apps for free without jailbreaking an iPod Touch. It is not possible.
No, not without jailbreaking your iPod 2g.